Benefits of becoming an SAP contractor

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We’re not here to tell you about the technical mumbo-jumbo of being an SAP Contractor. You have the skills, you’ve done the training, our aim is to make sure you consider a very popular, and profitable, option for your career in the form of contracting or freelancing.

Now a lot of people will tell you that freelancing involves a lot of hard work, we’re not denying that being your own boss has some downfalls, but the pro’s more than make up for it. There are a number of reasons why contracting could be a very good move for you.

Financial benefits

The first thing that most people think of is the financial benefits, and these are of course very compelling. For example:

  • An average contractor rate can easily be double that of a full-time employee, or even more
  • SAP Contractors Contractors are paid very high rates due to their skills and the flexible nature of the relationship and the fact that many positions can be relatively short-term.
  • Depending on your individual skills, the state of the industry in which you work (or the market in general) and the location of a contract, you can command very high rates of pay.
  • You have the choice to contract through an Umbrella company or your own Limited company. Your own limited company is the most tax efficient way possible and isn’t as hard or time-consuming as you might think, click here for our 1,2,3 guide to going limited.
  • If you operate through a limited company you have far better tax planning opportunities which can reduce your overall tax burden and increase your take-home pay. Forming your own limited company just takes 5 minutes.
  • You can offset all of your business expenses against your income to further reduce your tax bill.


As your own boss, you make your own choices- something which can be very satisfying and extremely enjoyable! For example:

  • SAP Contractors have the ability to be far more independent than permanent employees. Visit SJD’s comprehensive careers section for hints and tips on CV’s and job hunting.
  • You have the freedom to work when you choose, where you choose and for however long you like.
  • Changing a contract can often be far easier than changing jobs.
  • Contractors can take as much or little holiday as they prefer, most permanent employed people don’t get paid for any holiday entitlement unused during the year, as a contractor you will.
  • The company you work for is not your employer, but is instead your client, which puts a whole different flavour on the relationship!
  • Contract roles will give you much more flexibility when it comes to agreeing on working conditions.
  • You have more flexibility over the payment terms that you can negotiate.
  • You have the opportunity to develop your career in a way that suits your personal circumstances at any given time.

Skills development

As an SAP contractor, you will naturally work in a variety of different contract roles and in many different companies. This will help build up your portfolio showcasing the unique range of skills learnt from various companies. For example:

  • Gives you the opportunity to test out other industry sectors to see if you can widen your experience.
  • You can gain a really good insight into different company cultures, processes, operations and structures.
  • Working in many different companies gives you the ability to build up a wide-ranging CV and to establish an extensive list of reference contacts.
  • A good contractor will become known within their own field for their excellent work and you may even find that your services become sought-after, rather than you having to apply for new positions all the time.
  • As your experience and network grow, opportunities will come along with other contractors contacting you with regards to opportunities with their clients.
  • As a contractor, you will be exposed to many different styles of working, not only in relation to your peers but also in relation to your managers and your subordinates. This helps you to develop as an individual, in more ways than just your core skill set.
  • Your role is to come into an organisation as the ‘industry expert’, which is not only a nice position to be in, it also adds to your credibility as an industry professional, widens your experience further and helps increase your daily rate.

And now some downsides . . .

As you see, this is a fairly impressive list of positives, but it’s only fair to point out a few of the negatives as well. Some of these include:

  • You are responsible for finding your own work and making sure that the money keeps coming in-We recommend using job sites such as and as another source of finding you work.
  • You will also be responsible for negotiating your own payment terms and working conditions, which is something that you may not be familiar with in the early days (if you use a recruitment agent to find your contract they will usually be able to help here).
  • Contractors are responsible for managing their own finances – for example, things like tax, VAT and national insurance contributions – which may initially seem like a daunting prospect, however, any good accountant or tax specialist will be able to help reduce your stress levels.
  • At some point, you will have to decide whether to set up a limited company or trade through an umbrella company, and this can be confusing. To find out more about the pros and cons of each, please click here. Whichever route you choose, there will be paperwork to do and forms to fill in. This can be daunting until you know what you are doing, typically it actually only takes about 15 – 20 minutes per month administration to run your own limited company
  • Contractors don’t get the same benefits and ‘perks’ that permanent employees receive. There is no sick pay and no holiday pay, so it’s vital you manage your finances to cover for these times.
  • Not having traditional ‘colleagues’ can be lonely if you are used to this environment. There are a lot of things you will have to deal with alone, which is why it is important to build up a good support network of experts around you who can help you to manage all aspects of your business effectively.
  • Contractors can be the first to be laid off in a downturn however this is often balanced by the fact that in poor economic conditions companies tend to not hire employees due to ‘headcount freezes’ so turn to contractors to fulfil the available roles. As a contractor, you always have the freedom, the enthusiasm and the processes in place to get straight out there and find the next contract!

You now know all the pro’s and con’s of contracting, so if this sounds like the direction you wish to take on your career path, and would appreciate some further guidance contact SJD Accountancy on the below form.

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