First contract - caught by IR35?

[MarillionFan]

Firstly, I'd treat yourself as IR35 caught, plain and simple. You have too many important negative indicators going against you.

There's a general rule of 1000/1, which means a permie rate of £43K p.a equates to £43 p/h (or £344pd on an 8 hour day).

.

I do wish you'd stop using the calculation as it's complete bunkum.

You will be significantly better off contracting.

To a point further above ""Going contracting" is a career choice" is also nonsense. Half of contractors find themselves in that situation, the other half make a conscious decision to do so(Polls on this site prove that).

In terms of what to do. I would recommend that you go LTD as soon as possible and get an accountant. For you, I would recommend a fixed monthly fee and make sure you have someone to talk to about it.

Regarding the IR35 boogie man, it may well be that you are caught by that now. Best to research it for the future, but again, it's a boogie man used to scare naive contractors. Either ensure that you're working conditions/contract is designed to 'be' outside and frankly take the decision to just run yourself as a business. Maybe if you're unlucky sometime in ten years HMRC may decide that your £70k a year business is worthy of an investigation and may get upset you didn't have the £3.50 receipt for a sandwich in 2015, but frankly I wouldn't lose sleep over it.

Good luck.

[heyya99]

I do wish you'd stop using the calculation as it's complete bunkum.

You will be significantly better off contracting.

To a point further above ""Going contracting" is a career choice" is also nonsense. Half of contractors find themselves in that situation, the other half make a conscious decision to do so(Polls on this site prove that).

In terms of what to do. I would recommend that you go LTD as soon as possible and get an accountant. For you, I would recommend a fixed monthly fee and make sure you have someone to talk to about it.

Regarding the IR35 boogie man, it may well be that you are caught by that now. Best to research it for the future, but again, it's a boogie man used to scare naive contractors. Either ensure that you're working conditions/contract is designed to 'be' outside and frankly take the decision to just run yourself as a business. Maybe if you're unlucky sometime in ten years HMRC may decide that your £70k a year business is worthy of an investigation and may get upset you didn't have the £3.50 receipt for a sandwich in 2015, but frankly I wouldn't lose sleep over it.

Good luck.

Thanks for your reply.

Do you think I should go LTD even if I am caught by IR35? Worth it anyway?

[northernladuk]

Thanks for your reply.

Do you think I should go LTD even if I am caught by IR35? Worth it anyway?

Read MF's post again and this time make some effort to understand what he is saying. You are on your own now, you cannot, however much it looks like you need it, be handheld every step of the way.

[heyya99]

Read MF's post again and this time make some effort to understand what he is saying. You are on your own now, you cannot, however much it looks like you need it, be handheld every step of the way.

He said Either ensure that you're working conditions/contract is designed to 'be' outside and frankly take the decision to just run yourself as a business.

He didn't provide the OR.

[northernladuk]

He said Either ensure that you're working conditions/contract is designed to 'be' outside and frankly take the decision to just run yourself as a business.

He didn't provide the OR.

Jesus christ

I will condense it for you...

I would recommend that you go LTD as soon as possible

, it's a boogie man used to scare naive contractors.

Maybe if you're unlucky sometime in ten years HMRC may decide that your £70k a year business is worthy of an investigation and may get upset you didn't have the £3.50 receipt for a sandwich in 2015, but frankly I wouldn't lose sleep over it.

There are useful words inbetween but that is a little summary which I think answers your questions.

[Old Greg]

I do wish you'd stop using the calculation as it's complete bunkum.

You will be significantly better off contracting.

To a point further above ""Going contracting" is a career choice" is also nonsense. Half of contractors find themselves in that situation, the other half make a conscious decision to do so(Polls on this site prove that).

In terms of what to do. I would recommend that you go LTD as soon as possible and get an accountant. For you, I would recommend a fixed monthly fee and make sure you have someone to talk to about it.

Regarding the IR35 boogie man, it may well be that you are caught by that now. Best to research it for the future, but again, it's a boogie man used to scare naive contractors. Either ensure that you're working conditions/contract is designed to 'be' outside and frankly take the decision to just run yourself as a business. Maybe if you're unlucky sometime in ten years HMRC may decide that your £70k a year business is worthy of an investigation and may get upset you didn't have the £3.50 receipt for a sandwich in 2015, but frankly I wouldn't lose sleep over it.

Good luck.

Yuck, I'm agreeing with MF and I feel all dirty now.

But this 1/1000 is nonsense. I went from a 50k permie job into a £500 pd contract, which I decided was outside IR35. Guess what? In two years I had saved 60k. Just get on with it.

[MarillionFan]

Thanks for your reply.

Do you think I should go LTD even if I am caught by IR35? Worth it anyway?

Yes.

Remember. This is your first contract.

[northernladuk]

Yes.

Remember. This is your first contract.

I like MF's style and I like where he is going with this but in this case, and this one alone I disagree. Yes LTD is better and why not jump in now etc etc...

I just think people like the OP are struggling as it is. Umbrella for 3 - 6 months won't kill him and at worst he loses the difference between the two for a short time which isn't much to be fair. He learns alot and doesn't come out in a complete mess.

I just can't see the OP getting their head around the company, IR35, the accountants, managing their money etc without either asking for a lot of people to hold his/her hand and f**king up a number of times along the way. We have seen plenty of people come the board with old LTD's in tatters and huge bills hanging over them so it does happen. There is one posting today.

For this young padawan I say Umbrella to start IMO.

[MarillionFan]

I like MF's style and I like where he is going with this but in this case, and this one alone I disagree. Yes LTD is better and why not jump in now etc etc...

I just think people like the OP are struggling as it is. Umbrella for 3 - 6 months won't kill him and at worst he loses the difference between the two for a short time which isn't much to be fair. He learns alot and doesn't come out in a complete mess.

I just can't see the OP getting their head around the company, IR35, the accountants, managing their money etc without either asking for a lot of people to hold his/her hand and f**king up a number of times along the way. We have seen plenty of people come the board with old LTD's in tatters and huge bills hanging over them so it does happen. There is one posting today.

For this young padawan I say Umbrella to start IMO.

I would always recommend LTD if you think you're going to stay contracting. If you think it's a short-term thing and you want to go perm then Umbrella is the way to go.

Regarding the, 'getting your head around' bit, when you joined CUK NL you thought a 'company secretary' was something you had to place an advert at the Job Centre for and an Umbrella Company was... You get the drift.

[northernladuk]

I would always recommend LTD if you think you're going to stay contracting. If you think it's a short-term thing and you want to go perm then Umbrella is the way to go.

Regarding the, 'getting your head around' bit, when you joined CUK NL you thought a 'company secretary' was something you had to place an advert at the Job Centre for and an Umbrella Company was... You get the drift.

Haa haaaa!!! I did but I was Umbrella to start, then went LTD and look at me now. Go Umbrella first and you too can be like me!!!!!!

@ MF. You are undone of your own making foul knave...