Dodgy contractor schemes, undercutting and competition

[mudskipper]

evidence? or is it just good propaganda?

Speculation.

[cailin maith]

I pay a fair bit more tax in terms of pounds in the chancellor's coffers as a contractor than I ever did as a permie.

Don't you mean Your Co pays it? That isn't you.

Now where in NLUK when you need him?

[doodab]

I'm a permie and I earn a modest amount for what I do. I'm damn sure I pay a lot more tax than you do on your min wage/£10k per year salary and your whacking great dividends.

Unless you're a very well paid permie you're probably wrong. On a good year, even with a low salary and divvies, I would pay more in tax (combined CT, Income tax etc) than a lot of people earn, and certainly more than a permie doing the same role for £55-60k a year.

[MicrosoftBob]

Don't give me the bulltulip about how they should be contractors etc.

It's a choice whether you trade lots of money for the security of permiedom (), the training, the endless meetings, the excitement of 365 degree appraisals etc etc

[mudskipper]

Don't you mean Your Co pays it? That isn't you.

Now where in NLUK when you need him?

It's a fair cop!

[cailin maith]

I agree that many on here are disguised employees, and would fail an IR35 investigation.
Having employees is certainly an indicator of being outside IR35, but so is having multiple clients at once, working on your own equipment in your own office for fixed jobs of work that you decide the timings for.

Agreed but forget the multiple clients, IR35 malarkey etc. You (in general) pay yourself a min wage/salary and take the rest in Divs. It's a structure that benefits you greatly.

[cailin maith]

Unless you're a very well paid permie you're probably wrong. On a good year, even with a low salary and divvies, I would pay more in tax (combined CT, Income tax etc) than a lot of people earn, and certainly more than a permie doing the same role for £55-60k a year.

Again - your Co pays the CT not you.

And no, I'm paid ok for what I do but I'd bet Personal Tax wise, I've paid a lot more than you.

[northernladuk]

Don't you mean Your Co pays it? That isn't you.

Now where in NLUK when you need him?

Cailin Maith needs me!!! I knew this day would come!! Woohoo... No fear my love for I am here!!!

[sasguru]

Again - your Co pays the CT not you.

And no, I'm paid ok for what I do but I'd bet Personal Tax wise, I've paid a lot more than you.

Why does it matter where the tax nominally comes from? If contractors pay more into the coffers than permies that's a good thing, socially, shirley?

[Old Greg]

Genuinely, I don't think they are.

Co's want to pay as little as they can for the best work in the same way that you want to charge the most you can for the work.

So if clients want to pay as little as they can, and my competitor has a lower cost base, they can undercut me. And if they can undercut me, it seems likely that they do undercut me. Just like CD sellers operating out of Jersey (VAT free) undercut UK based sellers. This is pretty basic economics, and it would be surprising if it doesn't apply. There would be a nice little research studty in there I think.