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At this time last year, the UK had seen a 1.8% increase in demand for security cleared IT contractors, and average daily rates went up by 6.4%. This suggests that demand for security cleared contractors and daily rates of pay are increasing. With more people appearing to opt for contracting through their own limited company, now could be the time to weigh up your career options.

If you're interested in reading more about the advantages of becoming a contractor, take a look at our guide to contracting.

Whether you want to become a contractor or go for added security clearance, through your own limited company or by another route, this guide aims to provide you with an insight into what security clearance is, when as a contractor you might need it, and the various levels available.

What is security clearance?

If you are a contractor who will be working with or be accessing any classified or sensitive information, it is essential that you become security cleared before starting work. Security clearance (SC) essentially involves a series of background checks through vetting processes, to ensure that you are suitable on every level for a given project.

National security demands that anybody who works with ‘sensitive assets’ that may be classed as being at risk from serious crime, terrorism or espionage, should be subjected to undergoing various safety screening checks; these will offer guarantees that the person’s identity, integrity and trustworthiness are true. So, if you have secured a contract, which involves working on a project that is classified, you will need to achieve security cleared status before commencing.

Security clearance can be granted at either a government or commercial level, and depending upon the sensitivity or restriction of the information and area concerned, security checks will either be as standard, or a little more rigorous.

The primary SC levels, along with the time in days it usually takes to obtain clearance, are listed below:

  • Baseline Personnel Security Standard (BPSS) and Enhanced Baseline Standard (EBS) – These clearance methods are designed to offer employers an adequate level of reassurance that a candidate is trustworthy, with a high level of integrity, when it comes to working with sensitive or classified confidential information. This typically takes 14 days.
  • Security Check – This check is applicable to people who will be given access to information that may be considered ‘secret’, or ‘top-secret’. The process requires a Basic Check (BC) as well as a credit check, plus UK criminal and security checks. This particular check is predominantly carried out within government processes. This typically takes 30 days.
  • Counter Terrorist Check – If an employee requires access to information associated with national security and needs unrestricted access to particular commercial and government establishments, this level of clearance check is essential. This typically takes 30 days.
  • Developed Vetting – In terms of security clearance, Developed Vetting (DV) represents the highest level available and is granted only to people who are working within government security. There are several stages to a DV check, involving a questionnaire, detailed interview, financial checks and references sought. This typically takes 95 days.

These checks are usually carried out and verified by one of the primary Security Clearing bodies, who can include:

  • The Defence Vetting Agency (DVA)
  • Foreign and Commonwealth Office (FCO)
  • Metropolitan Police Service (MPS)
  • National Security Vetting (NSV)

tax question

What kind of jobs need security clearance?

Security clearance can be required for jobs across several popular sectors. Some examples include:

IT, administration, defence, engineering, intelligence, aerospace, nuclear, security, public sector and central government.

As you can see, the list above is wide-ranging, so having security cleared status can open up your working options as a contractor. One you are cleared, be sure to mention it on your CV and upload it to recruitment sites, to let employers know that you’re ready to move forward quickly and start work.

How much could I earn as a security cleared contractor?

As a contractor with security clearance, expect to earn more than you would without it; this is because you could offer an employer the additional high level of reassurance necessary for a security cleared contract job. Your employer needs to be sure that who he or she is taking on, is suitable to work with the information involved in a project by law, so within this niche domain, companies are often willing to pay more to ensure they get it right first time. This along with the positive befits of contractor tax management including VAT and expenses efficiency, means you could not only take home a great daily rate, but more of that money belongs to you.

To get a better idea of what you could take home as a contractor, try our free contractor calculator.

 

As mentioned above, it can be time-consuming to become security cleared. Within contracting, however, you gain the flexibility to work as and when you choose. Picking the jobs you want is a great perk, and with the addition of security clearance to your repertoire, you can add a better daily rate of pay to an already busy catalogue of advantages of starting up as a contractor.

IT Jobs Watch states that the current average daily rate for a security cleared IT contractor is £400 (2015), up from £375 in 2014. To help you get a clear idea of the amount that you could earn, as well as the types of roles that are currently available and the level of clearance required, the below are some recently advertised contractor roles:

  • Incident Manager - DV Cleared - £300-£350 daily rate
  • Oracle Developer - DV Cleared - £350-£450 daily rate
  • Operations Manager - SC Cleared - £400-£600 daily rate
  • Finance Manager - BPSS Clearance - £500-£540 daily rate

So how can I become security cleared?

It is not possible to apply for security clearance as an individual – an employer must apply for you to be cleared and certified.

Here is a list of important points you should be aware of:

  • Security Clearance is only granted for a specific period of time; this will depend on the term of employment and the length of any project. Typically though, you should expect to hold valid clearance for around 12 months after your project.
  • It is not essential to be a British National in order to gain Security Clearance.
  • It is possible to transfer Security Clearance to another employer, if necessary.
  • You will be obliged to meet any stipulated requirements, which are variable depending on the level of clearance.
  • If Security Clearance is required for a particular role, and you do not have it – you won’t be able to commence work in that role until clearance has been granted to you.

Do I already need to have security clearance to apply for a Security Check vacancy?

The world of contracting is driven by an immediate requirement for specialist skills. Without clearance, an employer could be placing a lot of risk on a project being successful, which could result in up to a three month wait for the new contractors to be cleared, or even having to recruit all over again, should clearance on the workers fail.

Contractors can become frustrated by the SC process within this field, because in order to receive clearance, one must be sponsored by a company to do so, but we don’t think you should be deterred. It could be worth, if especially apprehensive, taking a contract that only demands a Basic Check (BC), taking only two weeks to complete. BCs are not formal security clearance checks but act as a prerequisite to other security clearances; companies could be more inclined to offer you sponsorship, if you have a proven, positive track record.

Once you receive any clearance, you should keep a record of the details. Don’t rely on a sponsor to hold any information; when you want to transfer your clearance, it becomes your responsibility to keep continuity to prevent expiration, in spite of original clearance terms.

It is worth asking a recruitment consultant if you are unsure whether or not a role you are interested in applying to requires clearance; find out how they think it will affect the chance of you reaching interview stage. Your consultant should also be in a position to offer you an informed insight into client needs within the industry, and the market in general - so they could be a great point of contact to clear any confusion in this tricky market.

We understand that the clearance process could seem a little overwhelming, but don’t forget that the positive elements of joining the contracting world, which can can easily outweigh any clearance procedure:

  • Increased salary - You could earn up to a quarter more than a security cleared payroll employee, according to recruiters and job boards
  • Opportunity & variety - There is potential for wide-ranging job opportunities within contracting, including the opportunity to travel
  • Choose when to work - Temporary contracts allow you to choose which jobs you want to take, and when.
  • No long-term commitments - Increased likelihood of job offers, due to your specialist skills and immediate availability, and no long-term ties.

Finding Work as a Security Cleared Contractor

Job boards such as Security Cleared Jobs could be a useful tool those looking to find work in this sector. This platform allows users to search for both contract and permanent opportunities by their security clearance level, sector, position and location.

Another way to find contract roles that require security clearance is through recruitment agencies such as Hays, who have experience placing professionals in the defence industry.

Appointing an Accountant

If you are new to contracting you may wish to appoint an accountant who will be able to support you with the financial side of being a contractor and to ensure that you are working as tax efficiently as possible.

When engaging an accountant, you may want to consider if they specialise in the contractor market, as they can help with contracting matters such as IR35 and the flat rate VAT scheme.

Nixon Williams provides clients with an all-inclusive specialist accountancy service, catering for every contractor taxation need. For more information why not read more about us.

How we can help

Nixon Williams are an experienced team of accountants that have been successfully supporting contractors with their taxation requirements for 20 years.

Our all-inclusive, fixed fee Premier Accountancy Package, or secure online accounting portal, Vantage, are priced at just £95 +vat per month. Both options take care of all your business and personal taxation needs, with ongoing support from a dedicated accountant, who you can contact directly as many times as you need.

From setting up your limited company free of charge, to completing your accounts and paperwork, we are here to help you keep your operating costs down and offer a personal service to simplify your contracting life.

For more information about becoming security cleared, contracting in general, or how Nixon Williams can help you, please contact our new business team on 01253 362062 or email: newbusiness@nixonwilliams.com