Personal Service Company

Forming your own company means that you will be running your own business. You will be a company director, operate the company bank account, and be responsible for the affairs of the company.
Benefits

a. If you contract is not caught by IR35 legislation this is the most tax efficient way of working; you get to keep more of your income;
b. You have complete control of your financial affairs and company matters;
c. You are running your own business so you can undertake other work outside your normal contract role;
d. You can legitimately claim a wider range of expenses (training, equipment, software, etc);
e. Contractor status, as you will be seen to be “representing” the company and “running a business” with its own trading name.

Disadvantages
The main disadvantage is the amount of administration/paperwork arising;

a. As director you are responsible for maintaining company accounts and compliance with all company and other statutory matters;  
b. There are various deadlines which if missed could incur penalties;
c. You are responsible for day to day issues as invoicing, keeping a simple accounting system and ensuring all forms, returns and accounts are filed by the due dates;
d. Cost of liquidating the company if you decide to cease trading;
Many contractors, particularly first timers do struggle with these responsibilities.