[Closed] Becoming self employed, Limited company or not?

Doing some contract work (Mechanical design) at the local council and found out I can get £2-£3 /hr if I set myself up as self employed. I am currently working through an agency/recruitment consultant and I am effectively employed by them, who invoice the council.

A lot of people there have set them selves up as limited companies and invoice the agency directly, for £2-£3 more per hour. (doesnt sound much but it probably £400-£500 a month more).

So do I need to be a limited company and what does this actually mean? also what else do I need to consider setting my self up as a company, would I need PI insurance? anything else, other than a business bank account.

Also bit confused as to what I can claim tax relief on, someone said any travel, and something like a % of your utilities bills, mortgage payments and council tax too?

Cheers for any advice