IT Contractor initial contract

**Hex** · 24 February 2010, 11:27

For 3-4 weeks on a low paid contract it's probably best to use an Umbrella company. They will pay you PAYE. If you go this route then IR35 is irrelevant to you as you are being paid PAYE anyway which in essence is the requirement if you are inside IR35.

If you want to better establish whether the contract is inside or outside IR35 you need to look at the Right of Substitution, Mutuality of Obligation and Direction and Control aspects of the contract and the working practices. You can read up about these if you search. If you want a professional opinion on the contract you can get a legal firm to review it for you for about £150. Bauer and Cottrell and QDOSConsulting are two firms mentioned frequently.

To get an idea of your take home pay you need to use an employee calculator like the ones here (www.ir35calc.co.uk). Be aware though that this will calculate based on your Salary. Because the umbrella has to pay employer's NI as well as employee's NI, your Salary will be less than the total amount that your invoice your client for. Employer's NI is at a rate of 12.8%, but it only kicks in once you earn more than £5,700. As a rough guess I would take 90% of what you will bill the client for and use this as Salary and put it into the calculators for Permanent Employees referenced above. This will not be 100% accurate but should be close. The only way to get it more accurate that I can think of is to build your own calculator in Excel.

**northernladuk** · 24 February 2010, 11:47

Haven't you already asked these questions in the last thread (which happens to be right below this one) and got a bit of stick in it as well as some good advice from those willing to put up with this stupidity?

Why do you then insist on ruining any credit or respect you had here by asking the same questions again and not reading any of the links or advice given?

How can the stuff be overwhelming? You are supposed to be embarking on a consultancy career where you are a small business owner making your own living. If reading a few guides is beyond you then go find another job...

Nom nom nom as someone said earlier

**jmo21** · 24 February 2010, 16:41

Originally posted by northernladuk View Post

Nom nom nom as someone said earlier

**BolshieBastard** · 24 February 2010, 20:24

Originally posted by ntl737 View Post

Hello,

I am an IT worker and have been offered my first contract in the UK
from Monday. The contract is short(3 -4 weeks) and the rate is "low" since I'm new to the UK.

If I take the contract, what are the things I need to watch out for?

The company prefers I go the limited company route, but after
googling I found that this is not ideal for short term contracts
where the daily rate is "low". Besides, initially I don't want
to do the paperwork even though a limited company may mean more take home pay.

Also, I'd like to know how to determine if I am inside or outside
IR35. I asked the firm and the person was not sure. I know that a different set of rules apply for determining if the contract is inside or outside IR35.

I'd appreciate some thoughts here on
1) Should I go the PAYE route or limited company or umbrella?
2) Which calculator will help me get the number closest to the actual
take home pay? I've used a few calculators online and have got wildly varying take home numbers.
3) IR35 advice?

Also, my application for NI number is under process. My expenses will be commuting(GBP 20 daily) + lunch

Thanks in advance!

How about you **** off back to your own country while there are UK contractors unemployed and looking for work?

Just a thought for the troll.

**stek** · 24 February 2010, 21:21

Is this an official Bob Alert?

**escapeUK** · 24 February 2010, 21:23

Originally posted by BolshieBastard View Post

How about you **** off back to your own country while there are UK contractors unemployed and looking for work?

Just a thought for the troll.

You said what I thought!

**Stan.goodvibes** · 24 February 2010, 23:39

Originally posted by BolshieBastard View Post

How about you **** off back to your own country while there are UK contractors unemployed and looking for work?

Just a thought for the troll.

ahhhh feel the love

**Stan.goodvibes** · 24 February 2010, 23:41

Originally posted by ntl737 View Post

Hello,

I am an IT worker and have been offered my first contract in the UK
from Monday. The contract is short(3 -4 weeks) and the rate is "low" since I'm new to the UK.

If I take the contract, what are the things I need to watch out for?

The company prefers I go the limited company route, but after
googling I found that this is not ideal for short term contracts
where the daily rate is "low".

Why do you keep putting the word low in quotes?

**BolshieBastard** · 24 February 2010, 23:53

Originally posted by Stan.goodvibes View Post

ahhhh feel the love

**** that!

IT Contractor initial contract