Changing from a pseudo contractor to a real one

[radish2008]

Don't know ask those who work/worked for the BBC....

How many in the BBC ? 1 ? And wasn't she caught because she bought a house through her company ?

She wasn't caught because she went perm/contractor at the same employer though was she which is the point i was making. The post I replied to hinted that HMRC would spot this - I'd be very interested to know how they would do this.

[northernladuk]

How many people have been caught and prosecuted by HMRC in these circumstances ?

or paid out before it got to a prosecution of course.....

[SueEllen]

How many people have been caught and prosecuted by HMRC in these circumstances ?

Don't know ask those who work/worked for the BBC....

[radish2008]

If this is an previous employer, In my opinion the switch from employee to consultant could be questioned, HMRC would argue that you are possibly a disguised employee in their eyes and caught by IR35 legislation for contracts that relate to the ex employer.

How many people have been caught and prosecuted by HMRC in these circumstances ?

[DolanContractorGroup]

If this is an previous employer, In my opinion the switch from employee to consultant could be questioned, HMRC would argue that you are possibly a disguised employee in their eyes and caught by IR35 legislation for contracts that relate to the ex employer.

[WordIsBond]

Thanks for the comments.

Maybe it would help if I give a specific example.

My ex-employer get's in touch and says that one of their clients wants a GDPR information asset audit, I put together a proposal, say 5 days at £1k a day.

The ex-employer can charge the client whatever they want.

I complete the work and bill the ex-employer.

I may indeed be being overly optimistic with finding additional work and only have a handful of potential independant separate clients (not related to my ex-employer), but I'm fortunate to have a buffer to tide me over for a few months.

...also what does D&C mean, google has me confused

D&C means direction and control, a key factor in IR35 cases.

Given this scenario, a question -- will you be bidding a fixed price for these jobs, or a day rate? If the latter, HMRC are likely to argue, and probably win the argument, that you are still employed. If the former, you're probably in the clear.

Second question. Is there any reason you can't pay your current employer a referrer's fee for contracts they send your way, and contract directly with the end client? That way they get their cut but you are providing a service directly to the clients, you have multiple clients, and IR35 probably recedes from view.

[TonyF]

What are you going to do in between pieces of work? Is what you do that niche you can charge that and be confident of end to end work? If you are sounds like a good plan. What would be better would be to charge them a fixed price per job, not per day.

Why wouldn't your employer find and employee and pay them a third of that?

Two good points here. Are you planning on fitting this in around the work that your employer currently employs you to do? How is that going to work - days off work, or weekends?

If you can find the work this easily, why wouldn't your employer do it and then get you to do the work while they keep the money? Maybe I'm missing something here.

[jmo21]

thread title should be "Changing from an employee to a pseudo contractor"

[northernladuk]

Thanks for the comments.

Maybe it would help if I give a specific example.

My ex-employer get's in touch and says that one of their clients wants a GDPR information asset audit, I put together a proposal, say 5 days at £1k a day.

Is that a realistic figure per day?

What are you going to do in between pieces of work? Is what you do that niche you can charge that and be confident of end to end work? If you are sounds like a good plan. What would be better would be to charge them a fixed price per job, not per day.

Why wouldn't your employer find and employee and pay them a third of that?

...also what does D&C mean, google has me confused

Direction and Control.
https://www.contractoruk.com/success...need_know.html

[MarmiteSoldier]

Thanks for the comments.

Maybe it would help if I give a specific example.

My ex-employer get's in touch and says that one of their clients wants a GDPR information asset audit, I put together a proposal, say 5 days at £1k a day.

The ex-employer can charge the client whatever they want.

I complete the work and bill the ex-employer.

I may indeed be being overly optimistic with finding additional work and only have a handful of potential independant separate clients (not related to my ex-employer), but I'm fortunate to have a buffer to tide me over for a few months.

...also what does D&C mean, google has me confused

[l35kee]

This would allow me to separately engage with any new clients independently.

This sounds like the key? You wouldn't be engaging with new clients directly would you, you would be engaging with 1 client, your current employer.

[northernladuk]

Very little detail for us to go on here really but I'd question the bit about your work is a couple of days to a month. That would indicate to me you are contracted for a period but just given work to do as and when it turns up which sounds very much like D&C. You'd effectively be doing a permanent role on a different remuneration method.

IR35 is on a contract by contract basis so the ability to go out to market and find your own work won't really matter if they catch the contract with your current employer.

Most of us on here tend to work 3 month+ contracts. I'd be questioning your ability to find other work away from your client. I can see how this might work but I'd make absolutely sure you aren't being a bit optimistic and the reality is completely different.

I smell you just carrying on as you did for your ex-employer as a contractor so you are actually going from pseudo-contractor to disguised employee.

[MarmiteSoldier]

Hi, I'm currently a perm at a professional services firm.

I work with many clients on all types of information security and GDPR related projects.

There is the opportunity that I can leave the full time employment option and be engaged as a consultant instead (daily rate), the projects I work on are typically a few days, rarely longer than a month and would most likely run concurrently.

So basically the firm would charge the client £x and I would invoice the firm £y.

This would allow me to separately engage with any new clients independently.

I've done a fair amount of reading and a lot of the information seems to relate to much longer term contracts, or does this not matter? Do the same principles apply and an accountant specialising in contracting would still be my best option?

And if anyone hears any alarm bells ringing please say!

Cheers