*This content is brought to you by Sable International. Their team of contractor accountants in the UK, and support offices in Cape Town, Johannesburg and Durban mean they are perfectly positioned to assist you in moving yourself and your business to the UK.
By Ashley Deakin*
Skilled IT workers are currently in high demand and short supply in the UK. If you’ve been working as an IT specialist in South Africa, moving to the UK and finding work could be much easier than you thought. Freelancers, often referred to as contractors in the UK, have the freedom to work as they please and command higher hourly rates than their salaried peers. To get to the UK you’ll not only need the right skills, you’ll also need the right visa. These factors should no longer be seen as roadblocks to South Africans. Find out why below.
What exactly is an IT contractor?
IT contractors are freelancers who work on a contract basis for a variety of clients. They can typically apply their skills, knowledge and experience to a wide range of situations and fulfill a number of roles for their clients. These roles can vary from positions such as general IT support through to mid-level SQL, communication and networking roles, to extremely high-end developer and business analyst positions.
The common thread amongst all IT contractors is that they are highly proficient in their chosen field. As a contractor it’s important to be able to work unsupervised as part of a team, so to succeed you’re going to need discipline and diligence.
Why South Africans choose to contract in the UK
The earning potential and flexible lifestyle are just two of the draw factors that attract expats to contracting in the UK. Contractors generally earn more than the corresponding salary of a full-time employee, which is reason enough to move into freelancing. There are also various legal and tax planning methods that can be used to reduce contractor tax liability and increase take-home pay.
Tax benefits galore
If you conduct your business in the UK as a contractor through a limited company, you will benefit from a lower tax bill. While sole traders pay Income Tax, limited companies pay Corporation Tax on their profits.
In the UK, Corporation Tax is set at 19% for the current 2017/18 tax year, which is a 1% cut from the 2016/17 tax year. What’s more, the UK government has stated that they aim to cut Corporation Tax down to 17% by 2020, which means even more tax savings in the future. Compare this to the basic Income Tax rate which ranges from 20% to 40%.
If you choose to be the director of your limited company, you can draw a salary and still elect to receive a significant amount of pay in the form of dividends. By setting your salary at the optimal level, you can reduce your tax liability further. To ensure you get this just right, you should enlist the help of an experienced contractor accountant who is both based in the UK and, ideally, has experience with helping South African expats.
Limited liability for your peace of mind
When it comes to your finances, peace of mind is paramount. When using a limited company, you will have limited liability with regard to the finances and debts of the business. This means you will not be held personally liable for the company’s financial losses should things take a turn for the worse. Additional protection like this can enable you to take calculated business risks without the prospect of being personally liable.
Opportunities for long-term growth
In the long-term, a limited company structure can open up opportunities for your business. Once you are registered, you have the option to sell it in the future, which can’t be done if you’re a sole proprietor.
A limited company also allows you to contribute a portion of your income to a pension each month, and your pension contributions will usually be a tax-deductible expense, which means you can further reduce your tax liabilities. An experienced contractor accountant can ensure you are contributing the optimal amount to your pension so that you can take advantage of this tax relief.
A high demand and short supply of IT skills
The Recruitment and Employment Confederation revealed that demand for IT contractors in the UK hit a new high in August 2017. This is primarily because, given the unstoppable move to digital in just about every industry, most medium to large organisations in the UK need an IT specialist at some point.
Read also: What’s the best way to invest your way to a second passport?
Thanks to this shortage, IT contractors can find work in a range of sectors including: private, public and nonprofit. Candidate supply is simply not meeting demand at the moment, particularly in the financial services industry. Information technologies are becoming more and more indispensable in this field and many employers are ramping up their spending on professionals with the right skills.
Getting your UK visa can be simple
As many a holder of the much-maligned “Green Mamba” will tell you, one of the major hurdles involved in moving to the UK is getting a visa. The good news, however, is that with the right skillset it is actually relatively easy to get a visa; so long as you make your application in the correct manner.
You’ll need to know exactly which visa class to apply for. You’re going to need to apply for the right visa or risk being rejected out of hand and thus incur some major visa application fee costs.
Read also: Claiming British citizenship: Expert explains what you need to know
The best course of action would be for you to get in touch with an immigration advisor who can advise you on which UK visa would be your best bet. An experienced advisor will also be able to guide you through the application process ensuring that you don’t get tripped up by anything along the way.
There are two major categories that people looking to live and work in the UK fall into:
- Those with a familial link to the UK
- Those with skills on the Shortage Occupation list
Depending on your circumstances you may have access to a variety of visa options.
Those with some kind of family link to the UK
The Ancestry visa
Countries like South Africa, (and the other Commonwealth countries including many other former colonies as well) have a shared history with the UK and many British families settled in South Africa over the years. If you have a grandparent who was a British citizen you will be entitled to apply for an Ancestry visa, which gives you the right to live and work in the UK, without restriction, for five years.
Once you’ve held the visa for five years you can begin the process, should you so choose, of becoming a permanent resident in the UK, and then later, a full citizen.
Skip the visa and go straight for citizenship
The shared political and colonial history between the UK and South Africa has also given rise to an intricate set of citizenship laws. As a result thousands of South Africans, both young and old, may have a claim to full British citizenship without even knowing it. The criteria are exceedingly complex, but a good place to start is to fill out a free citizenship assessment here.
If it seems like there is a good chance you have a claim, it’s worth having a British citizenship caseworker conduct further research on your claim. You’d be surprised at how many weird and wonderful routes to British citizenship exist, so don’t make the mistake of thinking there’s no way you could be eligible.
Those who have skills on the UK’s Shortage Occupation list
If you definitely don’t have any links to the UK you’re going to need to apply for a Tier 2 (General) visa, often referred to as a work permit. This is easier if your job is on the UK Shortage Occupation list, which details the skills which are in shortage in the UK. The following IT skills are currently on the list:
- IT product manager
- IT business analyst
- IT architect
- Systems designer
- Software developer
- Shader writer
- Games designer
- Driver developer
- Embedded communication engineer
- Cyber security specialist
If your occupation is on the list, you can more easily apply for a Tier 2 (General) visa which will allow you to live and work in the UK for a period of five years and 14 days. You can also apply to bring your family with you when you apply for your Tier 2 (General) visa. After having lived in the UK for five years, just like with the Ancestry visa mentioned above, you and your family can apply for indefinite leave to remain (ILR) and eventually, British citizenship.
Do note: Although these are the roles that the UK desperately needs filled, there are other employment opportunities other than those on this list. It is possible to get a UK work permit even if your occupation isn’t on the list, the process is just more complicated. If you’re unsure of how to proceed, speak to a registered immigration advisor who can advise you on your options based on your qualifications.
- Ashley Deakin is the Chief Operating Officer of Sable International
