Scored my next gig through my own contacts and I have the choice of going direct with the client or keeping my current agency. The agent wants to charge 5% for operating a weekly payroll system (client has 90 day payment terms which is pretty crap), so I’d have to do a sell job with the client to see if they will pick up the 5% extra. The agent reckons that going direct opens up the risk of both me and/or client getting caught by IR35. Is the agent pulling his pud on this statement about IR35?
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Originally posted by beermeister View Post
Yes, IR35 is about your contract with either the agency or client and your working practices whist at your client.
If the agent is "running a payroll" that nakes them an MSC, and your full income is subject to PAYE.Cenedl heb iaith, cenedl heb galon
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He is talking through his @rse! Firstly IR35 concerns contractor and contract, the client is not affected by it. Secondly, by going direct by using your contacts you are operating more like a business and in that respect is a better indicator of not being caught by IR35.
However, for just 5%, the peace of mind that you may get from being paid on a weekly basis rather than having to wait 3 months for your next wad of cash, in my opinion would be worth it. Would they negotiate? 4%?It's about time I changed this sig...Comment
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That's spot on. Having a direct agreement with the client is beneficial to your position and cuts out the increasing problem of dodgy agency-end client contracts. From an IR35 perspective alone it is definitely the best option.Originally posted by MrRobin View Post
In that situation you are often able to supply your own T&Cs, which is another plus.Qdos Contractor - IR35 expertsComment
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Assuming an IR35 friendly contract (and working conditions), and a trustworthy (!) agency, I would go with the agency.
That also assumes that the 5% charge is being picked up by the client and not by you.
If you are going via the agency, then make sure that there is no restriction on you going direct at any stage.
I wouldn't work on 90 day terms, so if the agency will do it quicker than that, then it's probably worth your while to go that route.Comment
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by getting paid earlier the money could be put into a savings account
and earn interest, at 5% the agency cut looks very cheap.Comment
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He doesn't actually say that the agency will pay without recieving funds from the client - so it could be 97 days and a 5% fee !!Cenedl heb iaith, cenedl heb galonComment
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True, plus if he argues that going with an agency is better from an IR35 perspective than going direct, maybe you want to avoid this particular agency!Originally posted by Bluebird View PostComment
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5% sounds very good if they are willing take the 90 day wait and pay you up front. When I was in the same situation the agents I knew would only go down to 8%. As stated make sure they remove any restrictions on going direct. I'd negotiate with the client for 30 day payment terms. Is the client a rock solid company that won't go bust, if so and they'll sign your timesheets on a weekly basis then I'd stretch the 30 days a bit but 90 days is a long time.Comment
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Have you looked in debt factoring companies.
They may or may not charge less than 5% I suspect that they charge more.Comment
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