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Originally Posted by NotAllThere
Not quite. As I said, it's a rule of thumb. A starting point. Now, if you go ltd. as a contractor, you'll want to maximise your income - and that means minimising your Employer NI contributions. And to do that you want an non-IR35 caught contract.
So you should not expect to be paid when on holiday, or sick.
If you say £300 a day, then taking into account 6 weeks of holiday+sick+public holiday, that 48 x 5 x 300 = £72000. But that's based on a professional working day. Maybe you'll only be working a 7.5 hours day. Then you'd look at £30 an hour = £225 a day = £54000 a year.
You may be prepared to take less than this, considering that you've a non-IR35 contract, can offset some expenses, and you're guaranteed work for a year.
You really need to explain to them the costs of employment, then go for a figure where you get more than you'd get as an employee, and they pay less than they'd pay for an employee. To do that you have to quantify the costs of employing you.
You're already saving them ERNIC, administrative costs, and certain legal employment obligations. You'll have no employment rights - and these can be very expensive for a company - so you should seek compensation for that as well.
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Honestly don't think they can afford it. They wanted to match my current gross salary (£30K) and pay any expenses so I naively thought hey, no problem. I'll still get the same as I'm on in my current employed position after tax with the added benefit of more or less being my own boss. One thing I am confused about is the sickness/holidays thing. Surely if he's saying he'll pay me £30K a year then I'll get that regardless of how many days off I take or hours I work?? Or do I have to legally invoice them in hours/days worked? If I fall under IR35 how much of that £ 30K could I expect to see if that's the maximum they pay me?
They are a genuine company and I know they aren't looking to screw me down. They're just a SME who want to work with me and contracting seemed the easiest route to get it moving quickly. But in a nutshell, they can't afford to pay any more than the amount I mentioned.
Sorry if I'm not quite getting it. I guess I really want somehow to make this work as I hate my current job!!
Really appreciate your help so far. Thank you.