At first glance, you might think there’s little difference between the two. But there is, and it;s a subtle one. A temporary accountant job tends to be arranged via an agency. That means that the agency is your employer and that’s who your contract of employment is with, including your rate and other terms and conditions. They have their own rate and terms and conditions with the company they sell your services to. Their profit is the difference between the two. When it comes to things like holiday entitlements, it’s the agency who will pay you.
Contract Accountant jobs are quite different, although they are often advertised as temporary jobs. In this instance, your contract of employment will be directly with the client. You will negotiate your rate and other terms and conditions directly with your employer. More often than not, these kinds of jobs are very senior, and far better paid than any equivalent temporary position. The reason is that the company/client will be expecting a greater commitment from you, and daily – rather than hourly – rate.
This kind of relationship is best administered by way of a limited company, and it may be a condition of employment. This is for your own protection, since as a sole trader you would be exposing yourself to unlimited liability should anything go awry. Despite recent legislation, there are still considerable tax advantages to this kind of setup. If you’re a good networker, this could be the first step in setting up your own firm or partnership. Remember to get the appropriate legal advice. Your professional body should be your first port of call.