Consultant Business

[Nufy]

I'm thinking about leaving the salaried world and hiring myself out as an independant consultant.

I'm wondering what I would be looking at in terms of monthly and yearly expenses to operate in this fashion.

I do plan on talking to an accountant but I would like other opinions as well.

[Jlude]

What field?

[Nufy]

Electrical / Controls / Programming / Comissioning.

I have 10+ years experience in the above from wellsites to Turbine Compressors.

[Mikaldor]

Depending upon the clients that you will be working with, you may be required to hold a certain amount of insurance, supply certain equipment, and maintain certain certifications, educational standards etc. In my experience this has included items such as:

General Commercial liability - ?? will depend upon work situations - 500+ per year
Professional Errors and omissions - ?? will depend upon area of practice - usually pretty pricy at 2k+ per year
Workers Compensation - 0 to 500 per year
Educational allowances - 500+ per year
professional association memberships - 100 to 1000 per year
Annual book-keeping and tax - Depends on complexity - 100 to 500 per month
Health Benefits - depends on coverage - Blue Cross - 100 to 200 per month
Life/ disability insurance - depends on coverage
Cost of incorporation - 1 time - $300 - $1000

Minor stuff - phones, internet, business cards, website (Maybe) - $50 per month?

Fortunately all are tax write offs, and I've assumed a single person practice at the moment for the ballpark figures. Keep in mind, I'm not a professional in these areas, and you should talk to the appropriate providers for accurate info. :)

Plus you should factor in some intangibles, namely being vacation time, and any potential gaps between contracts. Keeping in mind that you are usually not eligible for EI as a contractor.

On the subject of General commercial liability insurance and Professional Errors and ommissions insurance, depending upon your client, they may be willing to take you in as a contractor under their insurance umbrella, so that you don't have to incur this cost / hassle.