Reply to: Perm or Contract in Investment bank

[biggie]

using SJD calculator @ 50 p/h comes out between 6.5-7k

if only

[floatsy]

Careful about those calcs now.

[max]

Permie:-

65.5 + 7,000 NI + 6,500 pension + 6,500 bonus (guess @10%) = 85,500

Days: = 260 - 25 holiday - 9 bank holiday - 5 sick (average) = 221

221 @ 400 = 88400

If outside IR35 you will be a bit better off. Inside it's about the same.

It may give you a guide to the take home pay differences.

[Bluebird]

Its an optional tax. Join the PCG, get their investigation insurance, put a few choice clauses in your contract and you are done. Check out the PCG win / loss ratio for IR35 investigations, and draw your own conclusions.

agreed, but it doesn't mean it's actually dead.

I believe it's dying, but as has been said many times, the contract is only part of the test for IR35, and even if the win - loss ratio is so big - what happens if you're one of the un-lucky sods who loses ?

If it was dead we wouldn't have to insure against it would we ?

[biggie]

Did the friendly agent tell you this?

of course he did

nah I go it checked by Qdos

[pickle]

How so ?

Its an optional tax. Join the PCG, get their investigation insurance, put a few choice clauses in your contract and you are done. Check out the PCG win / loss ratio for IR35 investigations, and draw your own conclusions.

[ASB]

Permie:-

65.5 + 7,000 NI + 6,500 pension + 6,500 bonus (guess @10%) = 85,500

Days: = 260 - 25 holiday - 9 bank holiday - 5 sick (average) = 221

221 @ 400 = 88400

If outside IR35 you will be a bit better off. Inside it's about the same.

[chicane]

contract is IR35 friendly it's an hourly rate

Did the friendly agent tell you this?

[Bluebird]

For the love of god, how many times. IR35 IS DEAD.

How so ?

[biggie]

contract is IR35 friendly it's an hourly rate

[chicane]

For the love of god, how many times. IR35 IS DEAD.

IR35 might be dead (indeed it reflects the words of my accountant). However, the government's next yet-to-be-introduced contractor robbing initiative, which they'll no doubt see fit to backdate by five years, is far from dead.

In an uncertain world, it still pays to take all necessary precautions.

[pickle]

I'd go permie - if you are paid overtime you are caught IR35 by my reckoning and thesefore should be paying full paye on your £400 per day...

For the love of god, how many times. IR35 IS DEAD.

[Bluebird]

Which is better from a financial perspective, future prospects

1) Perm @ 65.5K + 10% pension (Contributory pension) + bonus

in the hot area of credit derivitives.

Advantages: Training courses, perm job security etc etc
Disadvantages: Long hours and politics

2) 1 yr Contract role at 400 per day

not so hot area of Asset management

Advantages: Paid for overtime, not involved in poltics, quite easy going, think the take home pay is much much higher especially under ltd.
Disadvantages: not such a hot area of IB and may not be as good in the long term.

Which one would you guys consider and why ?

I'd go permie - if you are paid overtime you are caught IR35 by my reckoning and thesefore should be paying full paye on your £400 per day...

[biggie]

tnks 4 the reply guys it all helps when it comes to decision time.

btw the contract is 50 p/h

[TheFaQQer]

that was my original thought,
but 1yr contract seems quite good, and seems hard to turn down 400 a day.

£400 a day compared to £65k a year isn't that far apart.

General rule of thumb is to divide the annual salary by 1000 to get an hourly rate. £65 an hour roughly equates to £490 (7.5 hours a day), so you'd need to be looking at a higher contract rate than £400 to make the same.

A years contract may sound good now, but what do you do if four months into it, it's utter crap? Mind you the same could be said for a permie role.

What do you do now - permie or contract?

If it were me, I'd take the permie role compared to that daily rate - unless you can push the rate up to £500 and above on the contract, then £65k looks pretty tempting to me. Of course, it's not just about money though - I earn pretty much the same as I did when I was permie, but I only work 7 months a year and spend time with my family for the rest. To me, that's worth much more than the money - something to bear in mind if the permie job is going to be all hours, but the contract one really does turn out to be 9 to 5.

Finally, you mention paid overtime in the contract - does this mean that you are on an hourly rate that works out at £400 a day, or is it just your expectation? I work a "professional day" which can be anything from 6 to 12 hours depending on requirements and travel etc.