Maybe you're planning on picking up jobs on a freelance services marketplace, or maybe you're thinking about accepting a job as a contractor for a company: no matter how, if you are getting paid for doing programming work without being hired as an employee, you are working as a self-employed contractor.

Working as a self-employed contractor can be great for a lot of reasons: good pay, diverse working experience, flexibility - the list goes on. However, there are some sacrifices, nuances, and caveats that follow this sort of work as well.

Lack of Benefits

Most contracting positions do not come packaged with group benefit plans - which means you're on your own when it comes to paying for things like dental work, prescription eyeglasses, and medications. There are benefit plans available for workers without group benefits coverage; however, they tend to be more expensive and offer less coverage than their counterparts. This could be a deal-breaker for some people, especially those with dependents.

That said, you may be able to write off some eligible medical expenses come tax season, which can help lessen the costs of not having benefit coverage.

Vacation Allowance

Depending on the contract, you may not have an allowance for vacation. This is definitely something to inquire about and to double-check the contract for if you are planning on taking a sweet beach getaway mid-contract.

Taxes

Taxes for self-employed contractors can be more complicated than for traditional employees.

For instance, in Canada, you are responsible for calculating and making remittance payments throughout the year to the CRA for your taxes and CPP. You must also register for a business number, register for a GST/HST number, and collect GST/HST for any amount you make over $30,000.

If you are working as a self-employed contractor, it is important to do your research into the proper tax practices where you live or contact a tax professional.

Working from Home

Many contracts for contractor programmers in 2024 are remote. This means that you are responsible for finding an acceptable place to work, having the proper equipment to work, and for keeping yourself focused throughout the days.

For some people, this is great! For others, not so much. Most of us know where we stand post-pandemic, but the point here is to make sure you are comfortable with the working arrangements of the contract.

Contract Breaches

Just like being employed as an employee of a company, you can breach work agreements while working as a contractor. This could be as simple as working two contracts at once or committing plagiarism using your own past work.