£70,000 perm or £500pd inside IR35 6 month contract...

[sdd]

Pretty sure what answers are going to come back, but hey ho!

Have been contracting for about 5 years. Currently on the bench. Have been offered a £70,000 perm role and a £500pd inside IR35 6 month contract. I have enough in the bank to not have to rush into anything.

Perm role would be about £3700 take home after tax and pension, contract about £5500 after umbrella fees, everyone and his dog's NI, tax and personal pension.

In other words contract would be £1800 a month more in my pocket.

Here are my pros and cons...

Pros of perm:

• Real professional sounding job, would look great on CV and sound like I had my turnips together when people ask what I do
• Holidays, sick pay, company pension etc.
• Unless something went badly wrong, wouldn’t have to look for another position in the near future
• Hybrid role so would need to go into the office half the week which in all fairness is probably good for me (I prefer remote but don’t leave the house unless forced so have become a bit isolated and weird)
• If it sucks, could always stick it out for 2 years (for CV purposes) and then look at going back into contracting/another perm role (looking for a job would be less stressful as I’d already have one)

Cons of perm:

• Feel suffocated at even the idea of a permanent role. Think this might be personal commitment issues spilling over into work. Feels like ‘the end’, as if I’m going into an assisted living home to live out the rest of my days (this is ridiculous and illogical because it’s a role with room for growth and personal development)
• Less money in the bank, will take longer to pay off mortgage (3 years as opposed to 18 months) and will need to be tighter with money
• Might not like the role/people
• Might not be good at the role (haven’t done it before in this capacity, bit nervous)
• Not a huge fan of annual leave because I find work just builds up for when I get back
• Not interested in other ‘benefits’ e.g. cycle to work, new glasses
• Performance reviews etc.
• Hybrid role, 50 mins travel each way when in the office

Pros of contract:

• Good chance of extension
• Could pay off mortgage in 18 months as opposed to 3 years (rather boldly assuming extension(s), obviously)
• Enough money coming in to not be thinking about money (e.g. could get round of drinks in without a second thought and unconsciously noting who is/isn’t buying)
• Fully remote, no need to travel
• I know the role well and know I can do a good job for them
• Would bring experience with certain well known systems that I could add to my CV

Cons of contract

• Not guaranteed to be extended after 6 months
• Role I’ve done before, not very prestigious (have previously been a lead in the same role so this almost looks like a step back)
• Have a feeling the project isn't going to be a walk in the park for various reasons (although this could work in my favour re extensions)

Have at me

[Guy Incognito]

I would take a contract for less money just to avoid having to ever speak to HR.

[northernladuk]

Might have been more useful to post it in the professional part of the forum instead of the bearpit.

A few things I don't agree with, particularly the first two points below.

Good chance of extension

I would never put a 'chance' of a contract extending as a pro. Think yourself lucky if it does but putting it as a pro on the chance is a mistake IMO

Not guaranteed to be extended after 6 months

But you put in the pros that it would be and now in the cons it isn't? Gotta make your mind up.
So I'd take it out of cons, take this line out and add 'could be canned anytime from the 1st day up to the last day of the 6 months'
Also add in cons - High likely hood of bench time after this contract

You simply cannot compare a perm job to a single contract. They are completely different things. You need to compare the perm job to your contracting career, which is likely to mean bench time after the contract before the next one. If this keeps happening then add in 'multiple bench times' to the cons of staying contracting.

Also 'Might not like the role/people' can be very true for contracting, if not more so as you will have to start again on teh next gig so it's going to happen at some point.

'Feel suffocated at even the idea of a permanent role. ' You've made this your own problem because in general it's not true. Millions upon billions of people do it everyday and will for ever more.

'Not interested in other ‘benefits’ e.g. cycle to work, new glasses' is not really a Con is it. You might in the future. It's flexibility. Some you want, some you don't, but still not a downside.

I think the comment about annual leave is a bit rubbish as well and is self made. It's not a con really. Every job has it and even contractors take time off. Again, a bit of thought re-alignment to something more normal would remove this as a con.

[northernladuk]

I'm older so not as hell bent on chasing the dollar as I used to so I have to say a 70k gig looks very very appealing now. That said even when I was younger, if the title and work is as exciting as you say I'd take the perm role for the learning curve and come back contract with more skills and less benchtime. Do it for a year and make more back over your career from the new skills learned. It's not a massive pros/cons thing. Treat it as just another 12 month contract on crappy rate. We've all had them and it's not made one iota of difference to a long contracting career really.

If you still don't know what to do look at the work itself, the skills you'd learn on the job and consider how much extra you could charge once you come back to contracting.

[Fraidycat]

Perm role would be about £3700 take home after tax and pension, contract about £5500 after umbrella fees, everyone and his dog's NI, tax and personal pension.

If you really are ok with not taking many (or any) days off, then take the contract.

70K is tulip for 2022. Was offered almost 70K for perm job back in 2000. Having said that i was also on £600 a day back in 2000. So the contract rate you are being offered is tulip as well.

In the perm role do you get any bonus or share options on top?

[GregRickshaw]

I would take a contract for less money just to avoid having to ever speak to HR.

100% this or..... performance reviews

[sdd]

northernladuk Thanks for the response. I agree that not being overly interested in perm benefits such as paid leave, health schemes etc. isn't a con. I think it made it onto that list because I'd much prefer if they scrapped them and increased the salary instead, but you're right, they aren't cons. I suppose I'm just tired of having them sold to me as pros.

The contract comes with a higher chance of an extension than some others out there, but of course I appreciate that there are no guarantees and am not making any assumptions other than acknowledging the chance. It's a large scale transformation project that will take more than 6 months to complete. I understand that a lot can change/go wrong in this time. I listed the chance of extension as a pro but that was probably a bit disingenuous of me, as it's a pro over a different kind of contract (e.g. a three month quick and dirty implementation) rather than a perm job.

It's an interesting point you make about comparing a perm job to my contracting 'career' as opposed to a single contract. I'll think more about this, because at the moment I don't view it in that way. I've never really thought of myself as a career contractor, or as really having a career at all really. I just look at it as a series of 'jobs', some perm, some contract.

[sdd]

If you really are ok with not taking many (or any) days off, then take the contract.

70K is tulip for 2022. Was offered almost 70K for perm job back in 2000. Having said that i was also on £600 a day back in 2000. So the contract rate you are being offered is tulip as well.

In the perm role do you get any bonus or share options on top?

There is a performance related bonus, but it's not particularly significant (5-10%) and it's apparently only given to very high performers so I'm not keen to take it into account.

Thanks for calling the wage I've been offered tulip :P If you have any advice on how/where to get more I'm all ears!

[sdd]

I would take a contract for less money just to avoid having to ever speak to HR.

I mean, yeah XD

[Fraidycat]

100% this or..... performance reviews

I used to find it hard to get out of bed for 3K a month when i was perm back in day. I was always late in, would get to the office sometime between 10-11am. Would annoy almost every manager i worked with. Some a lot more than others.

As a contractor with that £10K+ hitting the account, even though it wasn't all mine and still needed to be corp taxed. I never had a problem getting out of bed and into work on time.