Fixed term contract with PAYE deductions

[Grinder]

I'm possibly in line for a fixed 1 year contract, but it will be conducted as a fixed-term employment contract.

Why doesn't clientco just offer a contract basis where I invoice - I am confused why they want to take PAYE deductions, meaning my costs are effectively out of 'net pay'.

What is the benefit to the client?

[jimjamuk]

just been offered the same

perks i was told
1 months notice
sick pay

not so great perks
average engineers salary

At least I was polite enough to wait until he finished the sales pitch before telling him to shove it up his hoop - as it was worse than a permie job i.e no pension, benefits etc

I'll take my chance on the bench - would rather take a job at £20/hr than do this

[DocP]

Schedule D

The problem with these types of contracts is that you generally can't claim expenses for them. Known as schedule D expenses you can claim them even if caught by IR35. It may be worth considering if those expenses are very low. For example, if you live very close by.

In general I would expect most people to avoid these like the plague. In cases where people do take them, it's generally from desperation.

[DimPrawn]

For example you can't claim travel to and from the clients office, it has to come out of your taxed income.

Also from an IR35 perspective, to me having so called business contracts and then being a permie and then a permie temp and then getting a contract does not look good in proving you are in business on your own behalf.

Unless it's paying an astronomical salary I'd take a low paid IR35 proof (as far as possible) contract instead.

[pleomax]

Nothing wrong with £20/p hr!

[Gonzo]

I'm possibly in line for a fixed 1 year contract, but it will be conducted as a fixed-term employment contract.

Why doesn't clientco just offer a contract basis where I invoice - I am confused why they want to take PAYE deductions, meaning my costs are effectively out of 'net pay'.

What is the benefit to the client?

Er, this isn't actually contracting.

This is being an employee with a fixed termination date.


hth

[jimjamuk]

Nothing wrong with £20/p hr!

Yes - sorry not having a dig at those earning £20/hr - I was just saying I would rather earn £20/hr on a contract and be in control of my own destiny than sign up for a £40k/yr fixed term contract. I past all that perm stuff now - if I ever went back it would be for a lot of money and perks to boot

anyway - second contractor got the same convesation this morning but he managed to butt in half way through and answered "I heard about that - no chance". The manners of some people.......

[Grinder]

Er, this isn't actually contracting.

This is being an employee with a fixed termination date.


hth

STO


So none of us can see what motivates the client to do it... most likely just short-sightedness on their part I suppose - shame because it would make it more viable.

[original PM]

There is a possiblity they are being extremely stupid.

They see you contracting earning for example £25 per hour but then offer you a job on £20 per hour and they feel they have saved £5 per hour.

Obviously forgetting all of the additional employee costs (Holidays/Employers NI etc etc etc )

Or it may be that they feel they will get your commitment for a year without worrying about it.

Or it's possible HR have decided that they need to cut the agency/contractor bills and so you then have to go on the payroll bill.

Plenty of reasons very few have any real benefits.

[Jog On]

Is this what 'pro-rata' means?