How much can I earn as a contractor in London?

Limited or Permanent Employee?

For the truth about Limited versus Umbrella pay, click through to this exclusive page: Take home pay Limited company or Umbrella company.

It’s a well established fact that contractors based in London earn more than in other parts of the UK, however in order to maximise your earnings you’ll need to work through either an Umbrella company or Limited Company. There are pros and cons for each method of working and all personal situations are different. Our recommended London accountancy firm, SJD Accountancy offer both Limited Company and Umbrella services, making them one of the very few firms that can offer impartial advice.

"So how much will I take home as a contractor in London?"

This is without a doubt one of the most common questions we get asked - not really surprising when you consider it’s one of the major reasons people decide to move from the world of the employed to contracting.

For any contractor working through your own limited company your take home will be anywhere between 75% - 80% of your contract value, for example:

  • Daily rate £200 take home between £150 - £160
  • Daily rate £300 take home between £225 - £240
  • Daily rate £400 take home between £300 - £320
  • Daily rate £600 take home between £450 - £480

Any accountant or tax adviser will tell you that working through your own limited company is the most tax efficient way of working, meaning you keep more of your hard earned money.

This free online contractor calculator gives a realistic indication of the amount a contractor could take from their contract when working through their own limited company.

If you would like to know more about working through your own Limited Company you can either:

Whether you’re new to contracting or have been in the industry years, you’ll find these pages extremely useful

Claiming expenses - Find out how which expenses you can claim to save you money!
Take home pay calculator - How much could you be taking home
First time Contracting or Freelancing? - A summary of the alternatives along with pros and cons
Step-by-step Guide to Contracting - Download a FREE copy of our guide
Limited or Umbrella? Can't decide? - We help you decide which is best
Take home pay case studies - Examples of contractors using a ltd co. & umbrella co.
Umbrella company guide - Everything you ever wanted to know about umbrella company services
IR35 Guide - A great plain English guide to IR35

SJD Accountancy

SJD Accountancy is the UK's largest specialist provider of fixed fee, limited company accountancy services to contractors and freelancers.

They have been acting for contractors across the UK since 1992, have more than 10,000 clients; are the only national specialist firm of accountants with offices in all major cities; are the most recommended accountancy firm on the internet and have more qualified staff than any other specialist firm with qualifications from the following major tax and accountancy bodies - ATII, ATT, ACCA, CA, ACA, FCCA, ACMA.

SJD Accountancy offers a complete package including: completion of accounts, payroll bureau, dividends, corporation tax computations, personal taxation, free bookkeeping software, unlimited access to your accountant and all company returns for a fixed monthly fee of only £95 plus VAT.

They have also won every relevant award possible, including: the 'Accountancy Age Award for Excellence' twice, once in 2004 and again in 2007, contractor UK’s 'Best Contractor Accountant', Sunday Times 'Best company to work for'; are a Quality Accountant as recommended by the Professional Contractors Group (PCG) and are recommended by the Sunday Times.