Contractors: IR35 & general discussion

[Pit Pony]

Deep Thought said:

Maybe some contractors operate like that but most invoice per day. I do. Always have.

If i'm not working on a given day, then i dont bill for it.

I invoice by the .25 of an hour.

I usually do at least an hour 6 days a week, but never more than 9 hours in a day and never more than 40 in a week. Some weeks I'll do very little on Wednesday and more at the weekend.
I love home working. Attendence costs in time and money.

[Deep Thought]

Pit Pony said:

Deep Thought said:

Maybe some contractors operate like that but most invoice per day. I do. Always have.

If i'm not working on a given day, then i dont bill for it.

I invoice by the .25 of an hour.

I usually do at least an hour 6 days a week, but never more than 9 hours in a day and never more than 40 in a week. Some weeks I'll do very little on Wednesday and more at the weekend.
I love home working. Attendence costs in time and money.

Yes, that certainly gives you flexibility. I'm 8 hours per day, 5 days a week, to be available across office hours on weekdays. Yes theres ebb and flow in any given day or week, but generally i need to be working on a given weekday to bill for it and i bill in half day minimum units across the five days with an expectation i'm going to bill for 5 days or thereabouts (ie, i couldnt just decide to work part time)

Its technical and consulting capability i provide so either predominantly working on something or sitting in on / hosting meetings.

Not hugely bothered by that - its the nature of the beast in my field

Currently WFH since March. Saving probably £2,000 a month on travel costs.

Edited by Deep Thought on Thursday 22 October 16:19

[anonymous-user]

Pit Pony said:

I've managed to get £800 a month for May, June, July and August. Added to the income from property of £450, it was just enough to survive.

That sounds tough, especially as you’ve been ill, last thing you’d want to worry about is money I’d imagine. Still one month at a time...

[anonymous-user]

Deep Thought said:

Poacher turned gamekeeper?

Resents the money most contractors still get without having to "work" for it like he has to now in his "very senior level" role?

Not at all, fair play to them, my guys are smart and work way harder than me, that’s the point of being in charge. How else do I get the time to goad you lot?

[Clockwork Cupcake]

Deep Thought said:

Olivera said:

If you've got several hundred contractors working for you then why are you so thin skinned and vitriolic on this PH topic? Especially given you used to be one yourself?

Poacher turned gamekeeper?

Resents the money most contractors still get without having to "work" for it like he has to now in his "very senior level" role?

Also, I can't help observing that wormus constantly seems to have the attitude that all contractors are cooking their books and under-paying tax, and taking the piss on expenses and the like. Given that we usually judge people by our own standards, and that wormus is an ex-contractor, one does have to ask where this attitude came from.

[CX53]

wormus said:

How else do I get the time to goad you lot?

Ah, okay.... It all makes sense now

[Raymond Reddington]

I've just found out a couple of the Connys at my place are sole traders.

Now, this isn't IT, it's a technical engineering/production role, contractor brings their own tools etc, but I was just wondering where this stands with regards IR35 and how likely they are to be kept on post April.

[bigandclever]

IR35 doesn’t apply to sole traders. It’s for incorporated companies.

If your question is more about employment status rules, that’s different.

[Clockwork Cupcake]

Raymond Reddington said:

I've just found out a couple of the Connys at my place are sole traders.

Now, this isn't IT, it's a technical engineering/production role, contractor brings their own tools etc, but I was just wondering where this stands with regards IR35 and how likely they are to be kept on post April.

Sole Traders are unaffected by IR35 because they are effectively taking all their income as PAYE/NI anyway via their Self Assessment tax returns, so are in the same boat tax-wise as inside IR35 anyway.

(Happy to be corrected, but that is my understanding)

[Raymond Reddington]

Without the employers NI I'm guessing because they and the business are one?

[V8mate]

I've read countless 'pros and cons' articles and 'know your law' articles etc, but have a conundrum I'd like to consider 'out loud'.

10 years ago, I operated as a freelance contractor for several years. Ltd Co - no issues. It was easy back then.

I'm currently a 'man of leisure', but a local firm needs a bit of commercial support - 'how long?' is a bit of string at this stage. Ideally, I'm looking for another PAYE gig, but money's money and should never be turned down, right?

Setting up another Ltd Co is a faff - a financial one more than a time/distraction one - especially if I only end up doing this thing for a few months. Key benefit (for me) is that I would dump most of the income into a pension as an 'employer contribution', rather than take much in the way of income.

I'd be contracting direct with the company - an uncomplicated SME - so wonder whether I should just do so as a sole trader... maybe just for the remainder of this financial year? I haven't earned anything else this (financial) year, so have a tax-free allowance sitting there unused. And by end March I should have a better idea of where the gig is going. If it's diamond, I could start a Ltd Co on 5th April.

Am I missing anything significant in my ponderances?

[Deep Thought]

V8mate said:

I've read countless 'pros and cons' articles and 'know your law' articles etc, but have a conundrum I'd like to consider 'out loud'.

10 years ago, I operated as a freelance contractor for several years. Ltd Co - no issues. It was easy back then.

I'm currently a 'man of leisure', but a local firm needs a bit of commercial support - 'how long?' is a bit of string at this stage. Ideally, I'm looking for another PAYE gig, but money's money and should never be turned down, right?

Setting up another Ltd Co is a faff - a financial one more than a time/distraction one - especially if I only end up doing this thing for a few months. Key benefit (for me) is that I would dump most of the income into a pension as an 'employer contribution', rather than take much in the way of income.

I'd be contracting direct with the company - an uncomplicated SME - so wonder whether I should just do so as a sole trader... maybe just for the remainder of this financial year? I haven't earned anything else this (financial) year, so have a tax-free allowance sitting there unused. And by end March I should have a better idea of where the gig is going. If it's diamond, I could start a Ltd Co on 5th April.

Am I missing anything significant in my ponderances?

Will the company let you do the work as a sole trader? Most prefer to deal only with LTD Cos, so if not your own, through an umbrella.

[V8mate]

Deep Thought said:

Will the company let you do the work as a sole trader? Most prefer to deal only with LTD Cos, so if not your own, through an umbrella.

I don't think they've even got an opinion. They've grown on the back of two brothers grafting, and they've suddenly realised that they need some commercial support to carry on climbing the ladder.

[Deep Thought]

V8mate said:

Deep Thought said:

Will the company let you do the work as a sole trader? Most prefer to deal only with LTD Cos, so if not your own, through an umbrella.

I don't think they've even got an opinion. They've grown on the back of two brothers grafting, and they've suddenly realised that they need some commercial support to carry on climbing the ladder.

Personally - and maybe someone will tell you otherwise - i'd do it as a sole trader if its only a few months work.

[Pit Pony]

wormus said:

Pit Pony said:

I've managed to get £800 a month for May, June, July and August. Added to the income from property of £450, it was just enough to survive.

That sounds tough, especially as you’ve been ill, last thing you’d want to worry about is money I’d imagine. Still one month at a time...

Or was it the worry over money that led to.my heart attack ? My plan that morning (June 23rd) had been to revise my cash flow spreadsheet, and work out exactly when the money would run out.
I think the prediction was April.

[Carl_Manchester]

Hey Pit, it’s tough going out there, sorry to see you are struggling. You have lots of company. General rule of thumb is that the uptick starts three years after the start of the downturn because that’s when unemployment peaks and starts to come down, there will be a bounce once the lockdowns expire and the vaccine gets rolled out but don’t expect things to be normal until April 2022.

Contractors are the first to get hit and the first to recover but it’s going to be a bear market for a while.

If it’s that tight, i would consider perm for a bit Once the temporary market bounce comes, there will be one.

[Trax]

Any one have any knowledge of claiming Furlough via your Umbrella company?

I’ve managed to last until now, but my contract has now finished, and there’s not much out there. I have spoken to my Umbrella, and they said they did claim and pay Furlough to its contractors at the beginning, but since August they had to stop, as they couldn’t claim Business NI or pension contribution, so they would have to pay that, which is greater than their fee.

Obviously during normal billing/payroll, they deduct the business NI and don’t pay any pension contribution, so is their any reason legally stopping them doing this for a furlough claimed payment? If there is, is there anything legally preventing them from claiming a higher fee to cover these costs, and implementing a new contract with me to enable this? Which I would be happy to do.

I.e., say my furlough claim is £2k, after my normal deductions pay is £1500, they then deduct £300 to cover the Business NI they have to pay, including their fee, and transfer £1200 to my account?

I have spoken to my MP, who has forwarded my question to HMRC, which may or not come, or take months. I know Umbrella companies can claim, after one of the unions kicked up a stink about it, but if they have to pay Business NI of say £200, and charge a fee of £50, they won’t do it.

Anyone with experience, or know the mechanics behind it, as it looks like my Umbrella would do it, but not when it costs them money to do so, understandably.

[Blown2CV]

would it be fair to be able to claim furlough in 2020 when in every other year, between contracts, you would just get nothing?

[mikef]

Surely if your contract has finished then so has your relationship with that particular umbrella company, at least until another contract comes up where you are able to work through them?

[Raymond Reddington]

Blown2CV said:

would it be fair to be able to claim furlough in 2020 when in every other year, between contracts, you would just get nothing?

I see your point, but every other year, the economy hasn't been stifled by government imposed restrictions on businesses..