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My Guide to Software Engineering Contracting in UK

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Re: My Guide to Software Engineering Contracting in UK

#41

Post by aussieguy1234 »

dukeyukey wrote: post #33
aussieguy1234 wrote: post #11

Remember, with GPT-4 around its alot easier to work with a language or technology you only have minimal exposure to. It's like having a Principal Engineer around 24/7 that you can ask questions to unblock you. So dive right in. You can also use it to practice the interview before the actual interview.

It's more like having an overeager intern around 24/7. Good at spitting back documentation at me or finding something from Stack Overflow, but really struggles with much else. Ise use ChatGPT and Copilot all day, they're incredible useful! But let's not overstate their power.

I don't use copilot so can't vouch for its accuracy but I have heard it produces code with security holes a large percentage of the time. I do use GPT-4. ChatGPT (GPT 3.5) is not that great. GPT-4 blows it out of the water. Let's take SQL as an example.

As a software engineer/founder, I've used it to write all kinds of advanced queries for Tunnelmole that get all kinds of metrics which previously would have require a Data team. You can write a prompt like "here is my table structure, give me a query to get my abandoned cart rate".

If I ever hire engineers for my project, prompting is a skill I'll be looking for.

Re: My Guide to Software Engineering Contracting in UK

#42

Post by danw1979 »

sirsinsalot wrote: post #21
jacobp100 wrote: post #15

Earlier quoted context omitted.

I found inside IR35 can be much more lucrative. It's big companies that have more money, can't hire enough perms, and just need stuff done

You have to ask why they feel the need to spend on contractors. Also if you're inside IR35 then you're an employee for all intents and purposes but without the perks of a perm position. Be a business, not an employee. If you look like an employee, regardless of the legal layout, you'll be remunerated like one. Be a business. They make more money.

> If you look like an employee, regardless of the legal layout, you'll be remunerated like one.

This just isn’t true. I’m currently with a FTSE100 financial institution and inside IR35 contractors make way more than perms at the same level of experience. They just don’t want headcount on their books, and still have work that needs doing, and they will pay to get it done.

The problem is job security at the moment.

If you don’t look like an employee, you’ll not get treated like one…

> Be a business. They make more money.

Completely agree, but most business owners make money by exploiting someone else’s labour.

Re: My Guide to Software Engineering Contracting in UK

#43

Post by simmerup »

madeofpalk wrote: post #32

I did this a bunch in another country for a few years, then moved to the UK and did contracting through a limited company for a few years. But now, I've switched to a perm role and I'm enjoying it a lot more. There's a lot less admin and tax stuff I need to deal with - I can focus fully on being a developer - plus I'm working on more fulfilling projects over longer periods, and making longer-term plans. Technically I…

The problem is that house prices in this country are so damn high, I personally have to think more about maximising money income than about doing a job I’d enjoy

Re: My Guide to Software Engineering Contracting in UK

#44

Post by harel »

I've been contracting for many years now. It's a good writeup, but as the top comment mentions - these are the basics. There is a lot of nuance. I'm exclusively Outside-IR35, and since this was rolled out to the private sector it dried up a lot of work as companies were spooked for no reason about this. There is still work out there but the market is not as good as it was a year ago. The rates mentioned in this article are 'bad market rates'. Good market rates are higher. I've seen some mention Inside-IR35 - there is a catch there. If you've done outside work, and then go inside, your tax gets bundled up and you can potentially end up paying top rate from the get-go, or finding your self with a higher tax burden than you expected. Talk to your accountant about that if you're planning to take on Inside gigs or a mix of both. I'd avoid umbrellas at all costs.

Re: My Guide to Software Engineering Contracting in UK

#45

Post by aussieguy1234 »

NicoJuicy wrote: post #34
aussieguy1234 wrote: post #11

Remember, with GPT-4 around its alot easier to work with a language or technology you only have minimal exposure to. It's like having a Principal Engineer around 24/7 that you can ask questions to unblock you. So dive right in. You can also use it to practice the interview before the actual interview.

Gpt-4 isn't an engineer. It's a stack overflow summarizer. If you would do new things, it won't be able to help you.

The idea that LLMs like GPT-4 are glorified stochastic parrots who are merely predicting the next word has been thoroughly debunked, almost no one in the field believes that anymore. Whats been proven so far is they actually understand your questions and their responses. Its also proven that they have some level of reasoning capabilities.

I highly recommend using it. Think of it as a Google replacement. Every engineer out there uses Google. Instead of spending hours on Google, you can spend a minute or two doing something new with the help of an LLM. They can be wrong, which is why they are better used in the hands of Senior Engineers.

Re: My Guide to Software Engineering Contracting in UK

#46

Post by aussieguy1234 »

madeofpalk wrote: post #29
aussieguy1234 wrote: post #11

Remember, with GPT-4 around its alot easier to work with a language or technology you only have minimal exposure to. It's like having a Principal Engineer around 24/7 that you can ask questions to unblock you. So dive right in. You can also use it to practice the interview before the actual interview.

I believe only not-so-strong developers actually believe this, after actual experience with this tech. That's just like saying that "Stackoverflow is like having a Principal Engineer around 24/7" which could be true to a degree, but it still doesn't make up for not knowing stuff.

This tells me that you haven't used GPT-4 (Thats not the free ChatGPT), or have not learned how to prompt properly. You can't ask Stack Overflow follow up questions. If the code from stack overflow does not work in the way you expect it to or the answer is not 100% accurate, you can't ask Stack Overflow to correct it.

Also, its better in the hands of Senior Engineers who can evaluate answers for correctness, because just like Google/Stack overflow, it can be wrong.

Re: My Guide to Software Engineering Contracting in UK

#49

Post by Silhouette »

vidarh wrote: post #39
PaulRobinson wrote: post #23

Earlier quoted context omitted.

Put it through a limited company and you’ll pay a lot less than as salary (and PAYE). It’s a weird quirk, but it’s about half the tax roughly. Means you’ll net about £80k minus some small costs. It’s been some years since I did this but an accountant can advise you and help you deal with any national insurance payments need to be dealt with.

The current dividend rates + IR35 means the gap is much smaller than it used to be.

There are a variety of situations where you can end up paying more tax working through a Ltd now. Just on naive marginal rates comparing income tax + employee NI with corp tax + dividend tax on the remainder you'll be looking (once the changes announced in the Budget come into force in April) at 28% PAYE vs. 26% Ltd for basic rate taxpayers but 42% PAYE vs. 46% Ltd for higher rate.

The Ltd rates can also increase noticeably if your revenues increase and your corp tax rate starts sliding up from 19% all the way to 25% (and that's not a marginal rate - your entire profit gets taxed at the increasing rate as you make more).

Of course as an employee you also get huge advantages like paid time off, employer pension contributions, a degree of automatic job security, and not having to file the paperwork and pay the fees for running an entire company. And via a Ltd you have a lot more flexibility to control both how and when you pay out your post-tax revenues that can sometimes be valuable. So it's never really an apples to apples comparison and there's always a lot that depends on your specific circumstances.

Re: My Guide to Software Engineering Contracting in UK

#50

Post by karaterobot »

I was a software contractor in Seattle for 13+ years, pretty much all of this holds true for that area as well, and I assume most of the U.S. at least.

> If you turn up and are rubbish, your contract will be terminated really quick. And if there are layoffs, contractors would (sometimes) already be well gone already.

This is one piece of advice I haven't found to be the case.

I have told the following lies as a contractor: "Sure, I know PHP", "Sure, I know Ruby", "Sure, I know Python".

The reality is that most of the time you're working on the shit that no employees at the company want to do, so no one is paying the least attention to you. Yes, you have to deliver functioning code on time, but you can get away with tap-dancing for a while until you learn the stack you're working on. In 13 years, I was never fired, and usually got my next clients via positive referrals.

The above explains why this statement IS true:

> You are always seeing new companies, new tech, new tech stacks, and the job never gets boring

That was the best thing about contracting: variety. Also the worst thing. I got about 3-6 months of experience on dozens of different technologies, but never mastered anything except the skill of learning skills quickly.

But in my experience, if you only worked on things for which you were already hot shit, you wouldn't get that level of variety, and you probably wouldn't get enough contracts to sustain a business. People do specialize, but the tendency in contracting is always to be a generalist because you have more options.

The two biggest skills in contracting are communication and faking confidence. They are paying you to deliver something, but really they're paying you to happily accept some of the stress they feel. If you practice saying "That shouldn't be hard, let me handle it" you are well on your way to being a success.

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