Contract v fixed term

[LondonManc]

Great thanks; please ignore my complete ignorance as i have been relatively sheltered as a contractor. My first contracting appointment (this one) has lasted two years. If i engaged as a consultant directly with the client and not through an agency and a PSC why would i be inside IR 35? surely i'd be outside IR35 no matter how long the relationship and particularly if i work for other clients.

KR

Have a read of NLUK's post of 11:32 today - new legislation comes in from April.

In terms of working for other clients, that makes no difference; a CONTRACT is inside or outside, not a PERSON.

[Lance]

No, it's not that clear cut. It would all depend on exactly what the working arrangements are, since Direction and Control remain the key determinant, plus lesser considerations such as mutuality, substitution and being "part and parcel" of your client's business.

You're right it's not always clear cut. Although when the OP admits to total ignorance of the factors that matter, I wouldn't rate his chances of negotiating anything outside in the first place.
The agent won't give a flying fart and will always say it's fine. The client may care more but know even less.

[emranio]

I don't think any of this is an issue. This is a simple case that the OP has done 2 years at a Govt agency and he is done. They don't allow extensions past 2 years so they are going to have to let him go as a contractor. There is no handcuff issues as he cannot be there past 2 years so the agency cannot prove loss.

He's simply being moved from a contractor to an employee. The standard way of getting in to PS is the 2 year FTC so all they are doing is changing the role from a contingent one to a permie one. No Pseudo about it. He's becoming an employee like everyone else that joins the civil service.

Because of that I doubt they will accept the rate he is contracting at or an uplift. The role will come with a rate which will be pretty derisory compared to the private sector.

Simple as that really. IMO after 2 years at the client the OP should know this and not be thrashing around like he is.

My client has advised there is no two year rule, just as long as i don't think of my self as an employee and as its through an CL1 agency and my ltd company i dont consider my self an employee.

[malvolio]

My client has advised there is no two year rule, just as long as i don't think of my self as an employee and as its through an CL1 agency and my ltd company i dont consider my self an employee.

Which only demonstrates both of your lack of knowledge of the reality of the situation. IR35 doesn't care if you are an employee or not, only that an employee-like relationship exists. After 18 years of IR35 you'd think people had learnt this, but hey...

Also, as an aside, if you're through YourCo and CL1 you are not actually direct, your contract is with any intermediate agency and ultimately Capita. As of April it will be paid net of all taxes.

[emranio]

.[QUOTE=

Also, as an aside, if you're through YourCo and CL1 you are not actually direct, your contract is with any intermediate agency and ultimately Capita. As of April it will be paid net of all taxes.[/QUOTE]

Yes i know, its not direct but the intention is to go direct. possibly B2B. hwo can they pay it net of taxes? currently i have had an assessment done and i am outside of IR35

[northernladuk]

.

Yes i know, its not direct but the intention is to go direct. possibly B2B. hwo can they pay it net of taxes? currently i have had an assessment done and i am outside of IR35

Read the legislation document that I've linked. It is covered in there.

[MrMarkyMark]

Read the legislation document that I've linked. It is covered in there.

I believe, yet again, we are letting a poster down by not giving him the answer he wants

[malvolio]

I believe, yet again, we are letting a poster down by not giving him the answer he wants

Too true. Sadly...

[emranio]

insightful and helpful thank you.

[supersteamer]

I believe a yardstick is around 30%, but I don't believe this covers the expenses side.

Where does this yardstick come from? Expenses wouldn't apply in either case as it's for more than 2 years.
If I plug £400 per day into contractorcalculator.co.uk it says revenue would be £88k with £26,070 tax outside IR35 and £31,491 tax inside. That's an increase of 6% on revenue. Yes, you can play about with holding money in the company (outside) and/or putting it into a pension (outside or inside) but I can't really see how you'd normally need a 30% rate uplift to cover it.