The All Things IR35 Related Thread

[Jokester]

If you have a good reason to deem it outside IR35 (ie you’ve got an independent assessment done by a specialist) I wouldn’t worry about HMRC.

You would then need to dispute it with your client, again the independent working practise and contract assessment done by an IR35 tax specialist would be your basis for this. If they don’t accept it, then yeah you suck up being PAYE and/or start looking for another contract.

We’re starting to see projects now being actively advertised as being outside IR35 as part of the job description so agents/clients are getting their act together over this.

 

[Electroshadow]

interesting email today from an end client.... basically charging £100 to assess if your inside or outside! Although don't be silly you can't have a VAT receipt for that.
will be interesting to see what they say especially deemed inside as I think that they have forgotten im on their approved contractor's list for ordering works.

you have to wonder sometimes who is running these large companies panic stations.

 

[Jokester]

Yeah, that’s how they’re all doing it in the contracting firms in Aberdeen as well. If you get the assessment done independently it only costs about £50 the cheeky ****ers.

 

[Kenai]

If anyone is interested this website is amalgamating different clients and their decisions on the matter - might be of some use to people.

www.offpayroll.org.uk

This is painting an increasingly bleak picture for contractors - seems more and more firms are just blanket banning PSCs from April onwards as their first resort as they simply can't be bothered with the hassle of assessments, disputes, processing payroll etc.

Could be a lot of competition for work at those places who are prepared to continue taking them on in the short term.

 

[sHo0sH]

I work in contract IT recruitment and I can tell you this is looking bleak for contractors - at least until companies reverse their decisions like in the public sector.

But £650/day after tax via an Umbrella will still net someone nearly £7k / month so I don't have that much sympathy to be honest

 

[ChrisD.]

But £650/day after tax via an Umbrella will still net someone nearly £7k / month so I don't have that much sympathy to be honest

Not inside IR35 it won’t. Even outside that’s the very best case scenario. My last contract was £650 a day and through a limited company, I wasn’t anywhere near £7k take home. Sure I could have swindled the books somewhat more but I played it safe.

Far too many people just look at the headline figures with contracting and don’t appreciate the bigger picture - (lack of) sick pay, pension, holiday, healthcare, gym benefits, car allowance, mileage allowance, job security, work phone, work laptop - I could go on. Plus there’s the constant hassle of dealing with contract renewals, various agencies (most of which are complete ******* to deal with), constantly updating your CV, dealing with liability/IR35/indemnity insurance, paying an accountant, doing year ends, self assessments and what not. Then there’s end clients thinking you’re permanent staff and trying to treat you as such. Don’t forget the ever looming HMRC shadow. I was a contractor for 6 years and I really don’t think I’d go back unless it were a 4 figure day rate and guaranteed to be outside IR35.

 

[sHo0sH]

Not inside IR35 it won’t. Even outside that’s the very best case scenario. My last contract was £650 a day and through a limited company, I wasn’t anywhere near £7k take home. Sure I could have swindled the books somewhat more but I played it safe.
.

I think you'd be surprised. Lets take the day rate of £650 and use 240 working days (assuming 20 off) would give you an annual salary equivalent of £156k (I understand there are no benefits or pension on top so this would essentially be your equivalent 'package')



The blanked out bit is the Umbrella fee.

So very close to 7k after tax

 

[Maccy]

I think most umbrellas would be taking a bigger cut than that surely?

 

[sHo0sH]

I think most umbrellas would be taking a bigger cut than that surely?

The good Umbrella's charge a fee - not a margin. Our agency has decided only to work with a few specifically regulated ones and have negotiated some bulk rates. I guess as the platforms are all automated now the running costs have been driven right down.

 

[Maccy]

And Sajid has just resigned. Hmmm....

 

[Django x2]

Not inside IR35 it won’t. Even outside that’s the very best case scenario. My last contract was £650 a day and through a limited company, I wasn’t anywhere near £7k take home. Sure I could have swindled the books somewhat more but I played it safe.

Far too many people just look at the headline figures with contracting and don’t appreciate the bigger picture - (lack of) sick pay, pension, holiday, healthcare, gym benefits, car allowance, mileage allowance, job security, work phone, work laptop - I could go on. Plus there’s the constant hassle of dealing with contract renewals, various agencies (most of which are complete ******* to deal with), constantly updating your CV, dealing with liability/IR35/indemnity insurance, paying an accountant, doing year ends, self assessments and what not. Then there’s end clients thinking you’re permanent staff and trying to treat you as such. Don’t forget the ever looming HMRC shadow. I was a contractor for 6 years and I really don’t think I’d go back unless it were a 4 figure day rate and guaranteed to be outside IR35.

Not sure what you'e doing but £650 a day is considerably more potential take home than £7k a month for an outside IR35 contract.

 

[Django x2]

And Sajid has just resigned. Hmmm....

Sadly, I don't think it's related, and only throws more shade to anything changing between now and April. The Lords enquiry has been a real eye opener so far, and crushes all the points our local resident tax fanboy has in this thread, but again, too little too late. The UK is about to face a £2.2bn productivity decline in the first half of 2020. I suspect, only recently, because of the protests, that people will now realise this isn't Brexit related, although most of the tabloids might still consider that the reason. Personally, I'm looking hard at Belgium. 3 day week, £1500 to £2k a day for my skillset and very much Outside IR35

 

[Maccy]

Sadly, I don't think it's related, and only throws more shade to anything changing between now and April. The Lords enquiry has been a real eye opener so far, and crushes all the points our local resident tax fanboy has in this thread, but again, too little too late. The UK is about to face a £2.2bn productivity decline in the first half of 2020. I suspect, only recently, because of the protests, that people will now realise this isn't Brexit related, although most of the tabloids might still consider that the reason. Personally, I'm looking hard at Belgium. 3 day week, £1500 to £2k a day for my skillset and very much Outside IR35

Belgium eh??
I'm hoping my contract with a Dutch firm will start ramping up more hours and I can move onto that "full time".

 

[Jokester]

There’s a steady dribble of people heading out to the ME now from Aberdeen, will only get worse once companies start putting people into PAYE under blanket assessments.

 

[Electroshadow]

just out of curiosity are those day rates for IT sector or finance? I'm obviously in the wrong industry Construction generally seems to top out below £500pd

 

[Steedie]

Not inside IR35 it won’t. Even outside that’s the very best case scenario. My last contract was £650 a day and through a limited company, I wasn’t anywhere near £7k take home. Sure I could have swindled the books somewhat more but I played it safe.
.

What on earth were you playing at then?! I suggest you get a new accountant no swindling required to get well over £7k on £650pd. You'd be looking at around ~£8k

Even when I was on £500pd I was taking home about £6600 a month.

 

[Jokester]

If anyone is interested this website is amalgamating different clients and their decisions on the matter - might be of some use to people.

www.offpayroll.org.uk

Been reading through a lot of the comments on there, seems a lot of companies (and I can't really blame the "contractors" for getting invloved with this) were quite clearly abusing the system and disguising their employees. People at the like of Tescos complaining that shop floor workers were being told they were inside IR35 and would need to go PAYE.

 

[jonneymendoza]

Anyone worried?

In a nutshell, a the new rules state that if a medium to large company hires a contractor, its up to the client to determine if they are inside or outside ir35. Before it was down to the contractor to do so.

Many companies are now just telling everyone to go inside IR35 meaning you pay the same tax as a permanent employee but with no benefits and holiday pay etc.

This is making many people in the IT industry panic in a big way.

I myself am taking a break to see what happens and either go perm for a year or two and then go back to contracting if things stabilise.

For me I would never go inside IR35. Not worth it at all and rather just go perm.

 

[bloodiedathame]

I was considering going back to freelance, but this IR35 shiz has put the willies up me.

 

[Hades]

I'm an IT permie in the Financial sector but have been watching the IR35 changes over the years. The contract market in the big banks has been wiped out with the new rule. They have all simply said they won't employ contractors anymore.