Outside to Inside IR35

**slogger** · 28 July 2021, 15:47

I recently had an inside ir35 contract at Morgan Stanley - high rate so compensated for higher tax - some weekend work which they paid at day rate, even when under 8 hrs which was nice. Fairly easy tbh - fill in timesheet, manager approves rest is automated. I was lucky in that I'm hitting 55 so could maximise pension payments and withdraw money at a lower rate when I retire soon. Wasnt treated any differently by MS or their staff - didnt feel like being an employee - still felt like contracting, however that may just be down to me :-)

**northernladuk** · 28 July 2021, 15:49

I can't stand the thought of the complexity of IR35 and having to spend time dealing with it all.

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To be fair to you, looking at the questions you ask about the work environment, which changes client to client, day to day and is often unrelated to your tax position you do demonstrate your unwillingness to put any thought in to this.

**PerfectStorm** · 28 July 2021, 16:19

Ir35 isn't that complex - nothing you couldn't pick up in a day and be comfortable with 'living out' over the course of a gig or two. It's all about making sure that you work in the way a self employed person would, working on their own account.

It's certainly worth it in terms of opening up opportunities and financially over the notion of any sort of taking an Inside role for ease.

**ladymuck** · 28 July 2021, 16:55

The easiest way to not have to deal with the complexities of an inside IR35 role is put the contract through agency payroll, client payroll or an umbrella if the first two options are not available to you. It will become overly complex if you try to put the earnings through your LtdCo

It's basically like taking on a fixed term contract, except with fewer rights and a client (sometimes) still thinking they're avoiding ErNI.

**eek** · 28 July 2021, 17:32

Originally posted by ladymuck View Post

The easiest way to not have to deal with the complexities of an inside IR35 role is put the contract through agency payroll, client payroll or an umbrella if the first two options are not available to you. It will become overly complex if you try to put the earnings through your LtdCo

It's basically like taking on a fixed term contract, except with fewer rights and a client (sometimes) still thinking they're avoiding ErNI.

Proviso to the above, if you wish to put a lot into your pension use an umbrella that offers salary sacrifice options so that the part of the money that should be going to pay the employer NI ends up in pension pot

**jamesbrown** · 28 July 2021, 18:24

You mean the complexity of YourCo receiving deemed direct payments and then your paying that to yourself as salary and/or dividends without any further taxes due and accounting for that properly in your accounts? Yeah, it isn't that hard (especially with FreeAgent or similar), but I probably wouldn't bother - it's even easier to work with an umbrella and you may benefit from a salary sacrifice pension too. If you want to keep your company open anyway, then you aren't saving anything on accounting fees, so that is moot. Of course, all of this assumes that the Fee Payer is even willing to make payments to YourCo.

**unixman** · 29 July 2021, 09:38

Thanks for those responses, which provided some reassurance. I'm probably going to accept the offer, along with an umbrella arrangement and make large pension contributions.

On a slightly different topic, I think that clients operating "blanket" Ltd bans will come under increasing pressure to offer work outside of IR35. Especially as the economy picks up and the market shifts in favour of job seekers. I'm working for a financial house now, outside of IR35. It wasn't that difficult - they hired a third party to verify compliance of each contractor.

**northernladuk** · 29 July 2021, 10:44

Originally posted by unixman View Post

Thanks for those responses, which provided some reassurance. I'm probably going to accept the offer, along with an umbrella arrangement and make large pension contributions.

On a slightly different topic, I think that clients operating "blanket" Ltd bans will come under increasing pressure to offer work outside of IR35. Especially as the economy picks up and the market shifts in favour of job seekers. I'm working for a financial house now, outside of IR35. It wasn't that difficult - they hired a third party to verify compliance of each contractor.

I'd agree but it won't be that many. It happened with the Public Sector. I had to leave my client at the time as they were blanket determining inside. I've been back as outside since and they've a good mix of outside and inside people via a pretty slick system (for a PS body). Only problem is that it's only a percentage of roles and a percentage of gov agencies. The vast majority I see are still inside.

I do think people don't realise how many roles were actually inside all along though. I think some blanket ban companies will reverse the ban as they get to grips with the legislation but only a few of the roles will be outside. It's not just a matter of them sorting their processes out, they still wanted PM's (for example) to supplement their perms and to give work to just as they see fit. That role should have been inside even in the old days. Even if the client starts working with outside gigs, many of the positions will still be inside.

**ensignia** · 29 July 2021, 11:31

I had an inside role for 9 months last year.

There is no practical or discernible difference between an Inside or Outside role for virtually 99% of roles and people.

Outside of us oddballs on here very few people know or care about the differences and contractors are seen as employees.

I'm almost glad the IR35 reforms came in.

Outside to Inside IR35