The All Things IR35 Related Thread

NVP said:
I guess you never saw my polite IR35 thread in Careers.

I was contracting to santander for 10 years straight, then come my contract expiry end of October I was told they would not be renewing any further contracts.

Come the end of november and those whose contracts finished a month after mine were told the same, then the week before they expired they were then informed the could continue via an employment agency (!)

I have since found a nice permie job close to home (which I've never had before) and am going to ride it for a couple years then reevaluate.

I've also been getting calls from Santander to rejoin via this agency. They can suck it.


In short: **** IR35, and **** disloyal businesses.
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Highlighted a key part in bold.

Surely if anything this proves you were essentially a perm employee in everything but name & tax?. Having a 10 year stable job at x3 the salary of the perm people doing the same work while paying less tax is clearly not as it was intended.

Personally I couldn't be more glad for this change, as a perm member of staff who works with a myriad of contractors getting paid x3 for the same work (none of which perform any better than our perm staff) was damaging to staff moral & bled our departments finances dry.
 
elmarko said:
Personally I couldn't be more glad for this change, as a perm member of staff who works with a myriad of contractors getting paid x3 for the same work
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As a contractor myself, I just can't understand how people sit in contracting roles for years and years. It's bonkers and they are, or were putting themselves at risk of an audit as it couldn't be clearer they are perm in everything but name. My last place, albeit in a different department, had a couple of contractors working for them, also for 10 years. Just mental. And the only reason they were there that long is they'd put themselves in that situation and couldn't get rid of them, as they were the only ones with the knowledge to do that job.
 
Django x2 said:
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.
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I really don't think it is, unless there's some form of tax evasion going on or a contract which allows an unusually high amount of expense claims. After taking away corporation tax for a 20 working day month that leaves £10530, I don't see how you can get away with taking over 70% from that without something dodgy going on.

Steedie said:
What on earth were you playing at then?! I suggest you get a new accountant :p 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.
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So none of that £6600 was going into a savings account in order to pay for self assessment? There's a difference between what does into your bank account and what's actually take home.

I've never understood the 'get a new accountant' remark. Doing books is very easy, and beyond taking a salary under the threshold, taking as many expenses as you can, there is no way of getting around the dividend tax rates. Unless it's some dodgy hairy arsed disgruntled ex HMRC accountant where most things wouldn't stand up to scrutiny in court.
 
elmarko said:
Highlighted a key part in bold.

Surely if anything this proves you were essentially a perm employee in everything but name & tax?. Having a 10 year stable job at x3 the salary of the perm people doing the same work while paying less tax is clearly not as it was intended.

Personally I couldn't be more glad for this change, as a perm member of staff who works with a myriad of contractors getting paid x3 for the same work (none of which perform any better than our perm staff) was damaging to staff moral & bled our departments finances dry.
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TBH its people like the guy you posted that are partly to blame for taking advantage of outside ir35 contracting.

Me, the most i have contracted in one place is 2 years and that was one time only. i try to folow the rules of being different to a perm staff by using my own equipment, working whenever i want and wherever i want, not engage in any client events etc etc.

It only takes a minority to ruin it for the rest really
 
elmarko said:
Personally I couldn't be more glad for this change, as a perm member of staff who works with a myriad of contractors getting paid x3 for the same work (none of which perform any better than our perm staff) was damaging to staff moral & bled our departments finances dry.
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Permie here too. I think you're getting upset at the wrong person. Quite aside from the amount of tax being due, you seem annoyed that your employer was paying someone three times the salary for the same work. Why on earth didn't you become a contractor there? You would have the exact knowledge and experience they need. Trust me, most employers show very little loyalty to any employee when it comes time to reducing the workforce size.

Presumably your employer was offering you some other benefit which made you happier to stay a permie rather than go contracting and earn more money. E.g. a perceived stability**, holidays, sick pay, pension, etc.




**Permie jobs are no more secure than contractor roles. They just appear to be more stable to the staff.
 
ChrisD. said:
I really don't think it is, unless there's some form of tax evasion going on or a contract which allows an unusually high amount of expense claims. After taking away corporation tax for a 20 working day month that leaves £10530, I don't see how you can get away with taking over 70% from that without something dodgy going on.


So none of that £6600 was going into a savings account in order to pay for self assessment? There's a difference between what does into your bank account and what's actually take home.

I've never understood the 'get a new accountant' remark. Doing books is very easy, and beyond taking a salary under the threshold, taking as many expenses as you can, there is no way of getting around the dividend tax rates. Unless it's some dodgy hairy arsed disgruntled ex HMRC accountant where most things wouldn't stand up to scrutiny in court.
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i dont think some people here really understand the amount of tax outside ir35 contractors pay.

It realy is similar to what a perm pays, infact contractors potentially pay more tax then your average perm.

People are forgetting that most contractors are sole shareholders of the LTD and thust they pay the corporation tax from the company and then from there personally account, thet pay self assessment tax. If that person goes over 43k, they pay about 30-40% tax afterwords.

So at best, a perm earning 70-80k is no worse than a contractor earning say 500pd working 11-10months a year and staying under the 43k threshold.

Yes a LTD/contractor gets 3x the money but they certainly cant spend 2/3 of that even or they pay same tax as a perm.

THE MAIN advantage of getting paid 3x the salary is for rainy days when your on the bench or decide to take a leave/holiday for a while. That is when the benefits are reaped, not so much now at present.

And for certain industry like IT prgramming, its good to jump ship once a year or twice a year, be it perm or contract.

If i go perm this year, i will not stay in the same place for 10 years lol. i will certainly still jump ship to further my exposure to different technologies, enviornments and get more salary/raise from doing so.
 
elmarko said:
Highlighted a key part in bold.

Surely if anything this proves you were essentially a perm employee in everything but name & tax?. Having a 10 year stable job at x3 the salary of the perm people doing the same work while paying less tax is clearly not as it was intended.
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Not my problem. If they wanted to employ me alongside the other employees they could have asked.
 
Jokester said:
There’s absolutely nothing in employment law that limits how long you can be a contractor for at one client if other conditions are met.
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Absolutely not, if your contract puts you outside IR35 at the start, and working practices match, then it will still be outside however long you stay there. But being somewhere 10 years does suggest you aren't really contracting and I'd bet that working practises don't match the contract you signed
 
NVP said:
Not my problem. If they wanted to employ me alongside the other employees they could have asked.
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I disagree it's not your problem. If the HMRC wanted to investigate it would be a strong indicator that you and your client were avoiding tax. If they find that's the case then it could result in a very big bill and fine which would be immediately payable. As mentioned by jokester there is nothing in law which states a contract duration. But it is an indicator that you may have been a disguised employee.
 
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