Sole Practitioner work while full time employed in Practice?

Sole Practitioner work while full time employed...

Didn't find your answer?

Hi all,

I've searched for forums and couldn't find a similar question so apologies if this has already been answered and I failed to find it.

I am qualified ACA, left a Big 4 firm 18 months ago to spend a year in industry, but am now returning to practice with a mid-tier firm. My ultimate goal is to set up my own practice, but would like to spend the next 2 years refreshing and gaining more experience with the mid-tier firm.

In that time, on the side I would like to start doing a bit of ad hoc work as a sole practitioner to get the ball rolling with my future plans (I understand I need a practicing cert for this). My question is - is there any reason why I couldn't do this, while employed full time by a large LLP?

Having reviewed my employment contract the relevant paragraph (below) refers to being in competition - my take on this is that as a sole practitioner completing ad hoc, tiny pieces of work would NOT be in competition and would be okay?

Thanks in advance for any comments/thoughts.

During your employment and for a period of six months from the Termination Date, you undertake not to, in competition with the [XX] Group, directly or indirectly canvass, solicit or deal with any Client or Prospective Client including, but not limited to being involved or concerned in any approach to, discussions with, tender or presentation to such Client or Prospective Client with a view to the provision of services to them in competition with the [XX] Group.  

Replies (5)

Please login or register to join the discussion.

avatar
By andy.partridge
09th Oct 2013 15:30

Unilateral

Your take on what is competition might not be quite the same as your employer's. The fact that you have asked the question demonstrates your uncertainty. If you are unwilling to discuss this with your employer then you are taking a risk.

If you discuss it you are possibly taking an even bigger risk. Your employer would understandably want to keep an eye on you because if you are not in competition today you sure as hell will be in two years time.

Thanks (0)
avatar
By Maslins
09th Oct 2013 15:35

If you don't mention it to your employer, they probably won't be too impressed if they find out.  If you do mention it, they may be absolutely fine with it, or they may simply refuse to allow it (even though it'd have no impact on your "day job").  Bit of a catch 22 IMO...kinda like asking for last minute day off vs pulling a sicky!

The other question is how official you do the sole trader bit.  To do things properly there are a lot of hoops to jump through, but many decide to ignore some of these until they've at least got a few clients and it's looking viable.

It's a tricky one, I had a similar dilemma ~5 years ago.  In the end did it "properly", full time employee one day, "just" a sole practitioner the next.  In hindsight part of me wishes I'd done it a little less formally, with some unofficial overlap.  Breaking a few rules, possibly.  Making life much easier, definitely.

Thanks (2)
avatar
By occca
10th Oct 2013 06:40

Practising Certificate

Agree with Maslins about your work - tricky

You will need a practising certificate, PI insurance, etc - I know you didn't ask this, just checking you are aware

 

Thanks (0)
avatar
By Ken Howard
10th Oct 2013 08:39

Been there, done that....

I think it's quite common to do jobs on the side.  I worked f/t alongside starting my own practice for around a year or so.  The hardest part is keeping it quiet from your existing employer which makes it hard to advertise and  you won't be contactable during normal office hours whilst you're at work which may make some potential clients wary of you and/or go elsewhere.

As long as you don't interfere with your employer's business, i.e. poach their clients, then the worst they can do to you is sack you when they find out.  Hopefully, by that time, you'd have built up some clients anyway to support you whilst you grow it further.  So, best to get some savings behind you to cover a few months lost wages if you did get sacked.

You also have to ensure that you get your practising certificate before you start - the reason being that if you're reliant on your employer to sign off your application, then they're unlikely to do it if you leave under a cloud or are sacked, leaving you with no PC!

It also goes without saying that you need adequate experience of the small-fry incomplete records jobs you're likely to get as a newly started sole practitioner.  That life is a lot different from a top 4 or mid tier firm, so make sure that you've got enough experience of the bottom end of the market, as that's where your bread & butter clients will be.  The last firm I worked for took on an ACA from a top 4 who'd spent most of his working life doing audits and he literally hadn't a clue about corner shops, builders, etc - he was a massive liability and had to be retrained in the realities of small, family businesses, incomplete records etc - he was so out of touch, he actually asked a corner shop-keeper for his "nominal ledger and day books"!

 

Thanks (0)
By Ashlea
10th Oct 2013 09:51

All I would add to the comments above is, whatever you chose to do, try your best to not burn bridges. In this business and every other business I think it is key to always part ways with employers on good terms. I always think the world surprises you with how small it is (or rather how easier we can travel and contact others long distance), so even though you may think that an employer is unlikely to cross your path again, be aware that he/she may know someone else who will or they may know someone who knows someone who knows someone who crosses your path. Point being you wouldn't want someone with a bit of a grudge no matter how small to have a negative impact on you later on.

Sorry to ramble, just thought that might help. Good Luck for the future!!

Thanks (0)