Giving up permanent job to start as IT contractor

I am in a reasonably paid IT job with a large financial company. I work just over 20 hours a week - Salary €35000, 5 weeks hols, pension beneifts and other small perks. I need more time off to look after kids during school hols, after school etc. Company have offered to take me on as contractor. What are the pros and cons of doing just this and how do I go about setting up as Sole trader. Or would it be better setting up limited company. Also I have no idea how to work out reasonable hourly/daily rate as I don't want to be worse off in the end!
Any advice would be really appreciated
Thanks

Once you become a contractor wouldn't you lose a lot of your rights i.e.regarding employment rights ? Do they have an umbrella company that would hire you or would you need to set up a ltd company? Have you thought of using up parental leave if possible instead of changing your status. You could end up paying employer PRSI as well as employee PRSI,losing out on bonuses,future pension contributions.. 35K for 20 hours a week sounds very good to me and I'm not sure that you would beat that contracting. If you have been with the company some time you may be on a higher salary than new hires. How would you feel about taking on a contract role and then that finishing and not being offered another one? The company would certainly not be obliged to do so, so there is obviously risk involved.

Whats their motive for doing this...hardly for your benefit!

I'd imagine they'd want you to bill through a limited company to ensure you can't be considered an employee. I don't think the costs of your own company makes sense if you're making roughly what you're making now, maybe an umbrella co. (ie: you get paid more than you currently do, buy said you wanted to work less, so guessing your new total will be about similar).
You'll lose all benefits except a daily/hourly rate, so holidays, bank/public holidays, redundancy etc etc etc. with a huge one being non renewal as already mentioned. Not all companies value contractors, you may be treated differently, and may not like the new dynamic.

There will be a big cost to do this, just make sure it's worth it.

Whats their motive for doing this...hardly for your benefit!

Click to expand...

Why so cynical? It sounds like they are trying to accomodate fairly unusual employee circumstances.

If the company are willing to accept invoices from you as a sole trader, then it's cheaper and simpler to do it that way. Most are now insisting on ltd companies for this sort of work.

Your hourly rate? As high as possible! Monetise all the current benefits (possibly tricky in the case of your pension but not impossible) and add them to your salary. Also add a grand or two for accountant's bills and the extra paperwork you'll have to deal with. Currently you work 45 * 20 hours a year so divide the total by 90 to get an hourly rate.

Well I work in IT and currently there are contractors on my team earning €400-€500 per day. Depends on what line of work you do. I'm a DBA.