The All Things IR35 Related Thread

MikeB · 2 Oct 2019 at 18:03

I'm about to convert, I can't live my life never knowing how much money I have, whether the tax man or government change their minds and effectively be looking for a job every 3-6 months anywhere in the world

As mentioned above, as a contractor convert, salary is great, perks, holiday, sick pay etc put me within 20% of where I was on my day rate

Jokester · 2 Oct 2019 at 22:24

Django x2 said:
Can't be as bad as where I am that when this first cropped up the senior perm manager said "I'm going to contact IR35 and have a chat with them"...

Oh dear. The sort of thing I get is, "how do you know your outside IR35?" (well you know contract/working practice reviews, you know, actually engaging in business activities outside my contract work, - even passing HMRC's CEST tool!), but hang on, your a contractor as well, surely you know what you're doing?!?

Certainly I've seen people read about stone wall disguised employee cases (the BBC ones spring to mind) and think they don't have a chance if HMRC comes calling, but if they did a bit of homework and sorted their paperwork out upfront they shouldn't have any problems at all.

Chris1712 · 2 Oct 2019 at 22:53

Those moving back to permie, do you think salaries are on the up? It’s nowhere near in my line of work (C/C++/C# dev). Contract rates are 400/450 a day but permie will be 45-55k pa.

Bit gutted tbh this was my only plan to earn more money, feels like its been pulled of the table for me now!

MikeB · 3 Oct 2019 at 06:34

Where I was contracting asked me to convert so I was in the driving seat and have secured way over what a normal perm might get, thought it lined up nicely as come April many people might find it's not worth contracting and the market could be flooded with talent

DarkLordStevoII · 3 Oct 2019 at 17:56

I have a ltd company working for a large construction company via an agency. We received our first hint of the end client stance today, with a brief email.

Government have changed IR35 rules...blah blah
'We have completed a very preliminary assessment, which indicates, at present, it is likely, that the majority of our consultants should be inside IR35'
If you believe you fall outside let us know, so we can discuss it further.

Well at least the are open to discussion, no idea if this will have any meaningful impact on their decision(?). I spoke to my agency and they had no idea this email was being sent out. It would be amusing, if the impact wasn't so serious, how on the fence and non-committal the statement is. There are massive fines involved if contract deadlines are not met so the impact of 50% of the workforce leaving would be huge.

NVP · 5 Oct 2019 at 10:55

Damn, after 10 years they got me. Got told yesterday they can't renew my contract which finishes end of this month. Apparently they aren't allowed to renew anymore contractors and will be getting off shore people from India.

3-4 weeks to find a new job

As an extra, wife had a new job all lined up when she finished maternity which they called and canned the day before yesterday, so both jobless now...

Zefan · 5 Oct 2019 at 12:45

NVP said:
3-4 weeks to find a new job

both jobless now...

Can't say I'm too sympathetic, you've been a disguised employee for a long time and have no doubt enjoyed the benefits of that. If you had done proper research as to your status, or even simply listened to the advice clearly stated in this thread, you could have taken action and been more prepared. I realise it comes across as cold, but you've had the best of both worlds for ages, and the writing has been on the wall for a while now.

fezster · 5 Oct 2019 at 12:50

Zefan said:
Can't say I'm too sympathetic, you've been a disguised employee for a long time and have no doubt enjoyed the benefits of that.

Love it. "Disguised Employee" - straight out of the HMRC propaganda handbook.

Did he used to go into work wearing a wig and false moustache, like a character from Guess Who, pretending to be one of the "regular workers"...?

dowie · 5 Oct 2019 at 12:51

NVP said:
Damn, after 10 years they got me. Got told yesterday they can't renew my contract which finishes end of this month. Apparently they aren't allowed to renew anymore contractors and will be getting off shore people from India.

3-4 weeks to find a new job

That sucks, sorry to hear that. Try to specialise a bit more/get some more skills perhaps then there is less chance of the role you do being outsourced. Generic BA roles and general say "Java developer" type roles working on essentially moving some data to one place from another can be outsourced far more easily, it is still pretty feasible to do so with some product knowledge required too - there are various Indian developers/BAs etc... out there with 5-10 years experience in banking related IT.

I mean they can't outsource everything - there are very expensive IT people still in London and even more expensive IT people in California etc.. if they could be replaced (given their cost) they would be, but they're still going strong and with plenty of demand in certain areas relative to the people available.

Zefan · 5 Oct 2019 at 13:11

fezster said:
Love it. "Disguised Employee" - straight out of the HMRC propaganda handbook.

Did he used to go into work wearing a wig and false moustache, like a character from Guess Who, pretending to be one of the "regular workers"...?

I'm using that term because it's a shorter way of summing up the reason as to why his position can't be maintained. Would making up another word for "a contractor who brushes against the permie line to such an extent it's verging on tax evasion" satisfy you?

dowie · 5 Oct 2019 at 13:14

To be fair it will become rather self selecting - the people who have been taking the **** for years might well have a pay cut and a regular job. The actual specialists with real skills to offer will still be in demand for consultation work/short projects etc.. and shouldn't have too much trouble finding work.

fezster · 5 Oct 2019 at 14:37

Zefan said:
I'm using that term because it's a shorter way of summing up the reason as to why his position can't be maintained. Would making up another word for "a contractor who brushes against the permie line to such an extent it's verging on tax evasion" satisfy you?

I actually don't particularly disagree with the point you were making - perhaps he was sitting on a ticking time bomb - it just makes me chuckle when people repeat HMRC sound bites like "Disguised this and that" ... when in reality, there's very little disguised about any of it. It's all in plain sight.

If you don't already know about the Behavioural Insights Team at HMRC, have a read. It's quite fascinating the way in which they slowly nudge the psyche to think in a particular way. You may even stop repeating said sound bites once you realise their purpose ;-)

"a contractor who brushes against the permie line to such an extent it's verging on tax evasion"

On this point, I must correct you. Incorrectly assessing oneself inside or outside IR35 is NOT "tax evasion". There is nothing criminal about it. No-one is going to go to jail over an incorrect IR35 determination, usually made in good faith.

NVP · 5 Oct 2019 at 14:48

Zefan said:
If you had done proper research as to your status, or even simply listened to the advice clearly stated in this thread, you could have taken action and been more prepared.

You talk without insight, you shouldn't do that.

ChrisD. · 5 Oct 2019 at 14:52

10 years in the same ‘job’, how is that anything other than being ‘inside’.

NVP · 5 Oct 2019 at 14:53

dowie said:
That sucks, sorry to hear that. Try to specialise a bit more/get some more skills perhaps then there is less chance of the role you do being outsourced. Generic BA roles and general say "Java developer" type roles working on essentially moving some data to one place from another can be outsourced far more easily, it is still pretty feasible to do so with some product knowledge required too - there are various Indian developers/BAs etc... out there with 5-10 years experience in banking related IT.

I mean they can't outsource everything - there are very expensive IT people still in London and even more expensive IT people in California etc.. if they could be replaced (given their cost) they would be, but they're still going strong and with plenty of demand in certain areas relative to the people available.

Its about time I guess. Not too bothered about being jobless, that's no worry and kind of a blessing as I wanted to get into property development sooner or later anyway, I am bothered about losing the dream career progression

It's not so much a 'you can be outsourced so you're gone' type of thing, more a 'we aren't having UK contractors anymore' - my boss is gone too. There is a list of people in queue for permie consideration but even then it'll only be 50k or something for anyone not a senior manager.

dowie · 5 Oct 2019 at 16:58

NVP said:
It's not so much a 'you can be outsourced so you're gone' type of thing, more a 'we aren't having UK contractors anymore' - my boss is gone too. There is a list of people in queue for permie consideration but even then it'll only be 50k or something for anyone not a senior manager.

It kind of is even if it is across your location (I presume you're not in London) - across a big bank you're still going to have contractors, just they're perhaps going to be rarer in more generic areas where people are easier to replace.

Trifid · 5 Oct 2019 at 20:46

Sorry to hear that. I'd have hoped they would move contractors over to permanent positions instead.

Django x2 · 5 Oct 2019 at 21:02

NVP said:
Damn, after 10 years they got me. Got told yesterday they can't renew my contract which finishes end of this month. Apparently they aren't allowed to renew anymore contractors and will be getting off shore people from India.

3-4 weeks to find a new job

As an extra, wife had a new job all lined up when she finished maternity which they called and canned the day before yesterday, so both jobless now...

It sucks, but after contracting for that long you'll have accumulated stacks of money in the business to tide you over for a few years... right?

NVP said:
Its about time I guess. Not too bothered about being jobless, that's no worry and kind of a blessing as I wanted to get into property development sooner or later anyway, I am bothered about losing the dream career progression

It's not so much a 'you can be outsourced so you're gone' type of thing, more a 'we aren't having UK contractors anymore' - my boss is gone too. There is a list of people in queue for permie consideration but even then it'll only be 50k or something for anyone not a senior manager.

Your biggest mistake. There is no such thing as career progression in contracting. It's simply not a thing. You loose that right, and mindset the minute you sign on a contract. Typically contractors cannot hold senior roles, especially in finance and the public sector. You're a gun for hire, get in, do the job you're paid to do and leave. If you were there for career progression, you were always inside IR35...

Throrik · 5 Oct 2019 at 21:04

Trifid said:
Sorry to hear that. I'd have hoped they would move contractors over to permanent positions instead.

It's a difficult one, even if they offered a hell of a lot of contractors wouldn't accept due to the pay being cut drastically to bring it inline with 'perm' staff - people like NVP have probably spent years on 100k+ paying minimal tax as part of his private limited company and his co-workers who are perm will likely be on 50-60k PAYE. It's been allowed to be taken advantage of by people for so long that they won't want to go back to the 'rubbish' wage.

NVP · 5 Oct 2019 at 21:25

Django x2 said:
It sucks, but after contracting for that long you'll have accumulated stacks of money in the business to tide you over for a few years... right?

Kind of, I have a decent property portfolio. I'm thinking of finding a nice easy permie job close to home and selling a house to get into property renovation.

Django x2 said:
Your biggest mistake. There is no such thing as career progression in contracting. It's simply not a thing. You loose that right, and mindset the minute you sign on a contract. Typically contractors cannot hold senior roles, especially in finance and the public sector.

Not the case at this place, contractors have become directors. The place is/was full of contractors, people would leave permie only to come back as a contractor etc. To be fair there is a huge chunk of old school permies too accumulated from the bought UK banks, even though a majority got decent redundancy offers through the years, but the IT here appears to be 50:50 here.

Trifid said:
Sorry to hear that. I'd have hoped they would move contractors over to permanent positions instead.

Same. I think they are but there are a lot of us to review.