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How work out the equivalent rate for inside IR35?

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    How work out the equivalent rate for inside IR35?

    Hello there,

    I've not seen a posting about a calculator of some sort. My contract is being deemed inside IR35 by HR. The client is keen to keep me on, so he's asked me how much does my rate need to increase by to bring in the equivalent rate I am on pre-IR35. I understand it's not a simple answer but at least I can give him an indicative figure.

    Has anyone seen/has a calculator that'll work out what is the equivalent rate? or can anyone provide me with some guidance how I can work this out.

    Thanks in advance for your help
    CJ

    #2
    Depends how long you've been there.

    Potentially by £1,000 per day to cover the back tax that you'll have to pay on your old contract.
    The greatest trick the devil ever pulled was convincing the world that he didn't exist

    Comment


      #3
      Apologies for not being able to assist with your direct question however, for me, without observable and documented changes to working practices, job description and services supplied then I would not even contemplate simply upping the rate for the same circumstance.

      If you have managed to integrate those things, then someone will be along shortly with a better answer but I've read 40% uplift being in the ballpark.

      Comment


        #4
        I think you could get close enough by using the calculators at Contractor Calculator website?
        Public Service Posting by the BBC - Bloggs Bulls**t Corp.
        Officially CUK certified - Thick as f**k.

        Comment


          #5
          Originally posted by chineseJohn View Post
          Hello there,

          I've not seen a posting about a calculator of some sort. My contract is being deemed inside IR35 by HR. The client is keen to keep me on, so he's asked me how much does my rate need to increase by to bring in the equivalent rate I am on pre-IR35. I understand it's not a simple answer but at least I can give him an indicative figure.

          Has anyone seen/has a calculator that'll work out what is the equivalent rate? or can anyone provide me with some guidance how I can work this out.

          Thanks in advance for your help
          CJ

          Nice, but then you are really rolling over and saying the contract was always inside in the first place.

          Walk away
          The Chunt of Chunts.

          Comment


            #6
            Originally posted by MrMarkyMark View Post
            Nice, but then you are really rolling over and saying the contract was always inside in the first place.

            Walk away
            Hence my reply.

            To be honest, it's easier to say "it depends".

            As in, it depends on:
            - What you currently claim as expenses on this gig - you won't be able to under IR35
            - How long you've been there - you are going inside IR35 and in effect submitting that you've always been inside IR35. As such, you'll need extra rate to cover any potential back tax that you're going to have to cough up.

            We've hit a step change in HMRC's "war on contractors". Rather than going after gigs that were a few years old, they will now be able to go after soft targets like you. By switching to an inside IR35 contract, you're leaving yourself wide open to a retrospective tax grab. They'll push hard on the "what's changed" front and if there's hardly any change, brace yourself.
            The greatest trick the devil ever pulled was convincing the world that he didn't exist

            Comment


              #7
              Originally posted by LondonManc View Post
              Hence my reply.

              To be honest, it's easier to say "it depends".

              As in, it depends on:
              - What you currently claim as expenses on this gig - you won't be able to under IR35
              - How long you've been there - you are going inside IR35 and in effect submitting that you've always been inside IR35. As such, you'll need extra rate to cover any potential back tax that you're going to have to cough up.

              We've hit a step change in HMRC's "war on contractors". Rather than going after gigs that were a few years old, they will now be able to go after soft targets like you. By switching to an inside IR35 contract, you're leaving yourself wide open to a retrospective tax grab. They'll push hard on the "what's changed" front and if there's hardly any change, brace yourself.
              Firstly i would be running or sprinting away not walking.
              Secondly, they won't ask they will assume you were inside through out the contract and you will have great difficulty showing otherwise
              merely at clientco for the entertainment

              Comment


                #8
                Originally posted by eek View Post
                Firstly i would be running or sprinting away not walking.
                Secondly, they won't ask they will assume you were inside through out the contract and you will have great difficulty showing otherwise
                I was trying to break it to them gently.

                But yeah, run! Oh and make sure you're getting paid before April 6th....
                The greatest trick the devil ever pulled was convincing the world that he didn't exist

                Comment


                  #9
                  Originally posted by LondonManc View Post
                  I was trying to break it to them gently.

                  But yeah, run! Oh and make sure you're getting paid before April 6th....
                  Paid weekly, with a special payment run just before April 6th

                  Comment


                    #10
                    - What you currently claim as expenses on this gig - you won't be able to under IR35
                    Just train travel

                    - How long you've been there - you are going inside IR35 and in effect submitting that you've always been inside IR35. As such, you'll need extra rate to cover any potential back tax that you're going to have to cough up.
                    it'll be 6 weeks when I reach 5 April. Though I have worked at my current client before 19 months ago.

                    We've hit a step change in HMRC's "war on contractors". Rather than going after gigs that were a few years old, they will now be able to go after soft targets like you. By switching to an inside IR35 contract, you're leaving yourself wide open to a retrospective tax grab. They'll push hard on the "what's changed" front and if there's hardly any change, brace yourself.
                    hmm thanks. I think I will bail out.

                    Comment

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