Your opinions please

[The Lone Gunman]

I am pretty confident I will be outside IR35 as only doing it parttime as well. I have heard contractor rates being 2-2.5 times the permie salary, but no idea if that is true and even if it was depends on how you adjust salary to a daily rate.

Tks Mike

You need an attitude adjustment! Forget about salaries and salary equivelants.
You ar ein business and you supply a commodity. You are subject to the whims of supply and demand.
Your hourly rate is dependant on the market and how much you are willing to work for.
Set the rate too low and you are not doing yourself justice. You will probably find contracts easier to get though. Remember, you will also be pushing the market down which we wont like.
Set the rate too high and you will not work so much, but will earn a lot when on contract.

This is about how you run your business and how much you charge for your product.

To answer your question, and it is only a rule of thumb, take the amount you would earn in thousands and divide by a thousand. That gives and hourly rate guide (as I said the market may say different). 50,000/1000 = 50 per hour.

[MarillionFan]

As a contractor why give a tulip. Thats a permie attitude you have there.

If a contractor is sat around with nothing to do that is the fault of the client. At the end of the day we are resource to be used and abused.

If you are diligent etc then bully for you. I actually fall into that camp as well and have finished contracts early because of a lack of work, but this does me no good, it costs me money.

If you buy a ferrari and stick it in the garage who's fault is that.

[AttitudeAdjuster]

Ok, thanks. So there is perhaps a case of Empire building along with contingency planning. Knowing the people involved at all levels I think the management do think that they need some capacity in reserve as it might be hard to get people at short notice. However, this kind of work is definately not rocket science (I know cos I'm doing it!). But I will bear these thoughts in mind before I say or do anything.


Cheers

[XLMonkey]

but back to the OP's topic... I've had to deal with this quite a few times as a client, a team leader for a group of consultants, and as a solo contractor.

My advice is this: the definition of value (i.e. whether its worth paying xxx pounds/day to have someone sitting around on the off-chance that you might need the), is down to the client, not you. So, even though you might personally think that they're wasting their money, that doesn't mean you should intervene to "help" them realise the error of their ways.

The problem is usually that there is a disconnect between the formal and informal contracts for someone to be there:

- informal contract = I want to keep x around for the one day in twenty when the tulip hits the fan and I need his/her skills available at short notice. The comfort of having them around is worth the money
- formal contract = Joe can only charge on for days spent in the office, so he spends an awful lot of time in the office.

You might know what the formal contract is that keeps these other guys around, but you probably don't know what the informal contract is. If you try to muck about with it, then unless the level of waste is grotesque, it is unlikely that the client will really thank you for it.

[tim123]

Frankly, ISTM that inside or outside IR35 is irrelevent.

The guy's choice seem to be: accept a job inside IR35 or be on the bench.

This seems like a no brainer to me.

So to answer his question, to get an appropriate contract rate:

Take the perm salary and work out the hourly rate (dividing by 1800-2000 is a normal figure). Then multiply by two.

No, this doesn't mean that your will be getting paid twice as much. What it means is that all the paid for employee benefits: holiday pay, sick pay ma/paternity pay, pension contribution, ERNI, etc, etc, etc are amortized into the hourly rate because the employer is not paying them anymore, you are!

HTH

tim

[DaveB]

I am pretty confident I will be outside IR35 as only doing it parttime as well. I have heard contractor rates being 2-2.5 times the permie salary, but no idea if that is true and even if it was depends on how you adjust salary to a daily rate.

Tks Mike

Makes no difference. If you are performing the same role for the same company, part time or otherwise, then you will be caught by IR35. This is exactly the situation IR35 was intended for to begin with, before HMRC decided to try and widen the application.

[masplin]

It's actually a completely different role

I am pretty confident I will be outside IR35 as only doing it parttime as well. I have heard contractor rates being 2-2.5 times the permie salary, but no idea if that is true and even if it was depends on how you adjust salary to a daily rate.

Tks Mike

[Cowboy Bob]

Sorry to jump into this thread but I am new to this and despite registering cannot see anywhere to create a new thread? I have been made redundant from my permie role and being offered an alternative contracting role. I have never contracted and just looking for some guidence as to what a £50k annual salry roughly equates to in terms of daily rate? I have done the calculation to take into account various perks, but know there is an unwritten contracting premium.

Any help gratefully received (even if telling me how to take this and start a new thread!!!!)

Apologise for messing with the system

Mike

If the contract is in the same company then you're screwed. You will fall foul of IR35 (so you're kind of on topic by accident) which means you will pay the full employers contributions on top of your existing employees contributions. You need to factor that into your calculations.

Apart from that, read the stickies at the top of the board and the "First Timers" guide over there ---->

[masplin]

Act of complete desperation

Sorry to jump into this thread but I am new to this and despite registering cannot see anywhere to create a new thread? I have been made redundant from my permie role and being offered an alternative contracting role. I have never contracted and just looking for some guidence as to what a £50k annual salry roughly equates to in terms of daily rate? I have done the calculation to take into account various perks, but know there is an unwritten contracting premium.

Any help gratefully received (even if telling me how to take this and start a new thread!!!!)

Apologise for messing with the system

Mike

[bobhope]

That's a pointer towards IR35 (Mutuality of Obligation) whereas leaving if there is no work is a pointer against IR35. You could always shop them for that if you feel that strongly - which to be honest, seeing as its public sector and my money they're squandering, I'd be tempted.

I wouldn't necessarily go rushing to do that. Quite often, these warm bodies will be part of somebody's little empire and if you attempt to dismantle it, you won't be the most popular person.

[Cowboy Bob]

That's a pointer towards IR35 (Mutuality of Obligation) whereas leaving if there is no work is a pointer against IR35. You could always shop them for that if you feel that strongly - which to be honest, seeing as its public sector and my money they're squandering, I'd be tempted.

[AttitudeAdjuster]

Guys,

Where I am working, there are a few contractors who have absolutely nothing to do. So they spend the whole day surfing the web. Now, if it were me I would feel slightly guilty about taking in excess of 40 Squid an hour for nothing.

When I was working on an hourly rate I made sure all my time was bookable to genuine work. I would leave early and say to the boss, 'there is nothing left for me to do'.

I always thought you should take the rough with the smooth when contracting. You must expect to be laid off/on short time it goes with the t & c's.

What makes me concerned is that this is not some city bank with wads of cash to throw around but in the public sector. In other words it is yours and my money being squandered..