In a previous article, I covered the process of becoming incorporated as a software development consultant. I briefly described the steps I took to establish the company.
Now, six months later, it feels like the right time to follow it up with more details. In this article, I will explain in more detail the steps I followed to get incorporated and how the first month has been for me.
I decided to incorporate
Currently, the job market for software development in Canada and the US is very hot. It is quite easy to find new opportunities as a full-time employee or on a contractual basis.
Last year, having switched employers a few times before and being rather burned out with the position I was occupying, I decided it was time to make the leap.
Working on a project with independent consultants early in my career also motivated me to take the plunge. They taught me a lot about the differences between what I did and what they did.
Part of the reason I'm writing this and earlier articles is to inspire and guide anyone thinking about doing something similar.
However, I recommend conducting thorough research ahead of time. Contractual work is inherently uncertain, requiring additional planning and preparation.
I found my first contract
As I stated in a previous post, I kept in touch with a number of recruiters who reached out to me on LinkedIn throuout my career as a software developer. This is when it started to pay off for me. All I had to do was let them know that I was actively looking for a contract.
Soon enough, I was booked for a few interviews, and it was time to demonstrate my talents. Naturally, having conducted dozens of interviews before, the process went well, and I received an offer shortly after.
I signed a contract with a recruiting agency rather than directly with the client. I did so to avoid being taxed as a Personal Service Business. This tax category was created to deter incorporated employees by imposing harsh penalties.
I consulted with experts
I had no prior experience of owning a business before making the decision to transition to freelance consulting. Therefore, as soon as I finished all the paperwork for the business, I had it verified by an accountant to ensure that everything was done correctly.
For anyone considering doing the same, I recommend consulting an attorney or a CPA to set up the appropriate forms of business, government tax accounts, and share structure, if necessary.
Furthermore, when operating as a business, it is critical to keep all records up to date and ensure that taxes are collected and remitted to the government on time to avoid penalties. I suggest speaking with an accountant about what needs to be tracked.
In my previous posts, I went over how I created my corporation in Quebec and how I structured the finances of the business.
I got to work
After taking care of all business and accounting matters, it was time to get to work and provide as much value to my clients as possible. To assist with this, I implemented a few productivity-boosting strategies.
I use the appropriate tools for the job. Even if it means using my own hardware and/or software, if the client is okay with it. Any hardware or software licenses used for work are considered business expenses. They pay for themselves in the long run.
I read the documentation. When using a framework or library for the first time, instead of instinctively following the same patterns I’m used to, I look up the official documentation and learn how the framework or library is supposed to be used. This allows me to avoid writing anti-patterns that pile up technical debt later on.
I remain informed about new technologies. I achieve this by reading technology blogs and watching software-related YouTube channels. Also, I experiment with new frameworks that interest me or are really popular. As a consultant, I believe it is essential to be familiar with as many technologies as possible.
This blog post chronicled the key steps I took in my career since the day I decided to work as a consultant.
My first step was to commit to the transition. Then I secured a contract and established the company. After that, I worked with a CPA to get my tax files and financials in order, and finally, I got to work providing value to my clients.
If I can leave you with some advice, if you feel like you’re competent in what you do and have enough savings to cover 3-6 months of your basic expenses, then go for it! The risks are quite low, and who knows? You might find your new life liberating. I know I did!