Reply to: Nothing will change until IR35 changes start to hurt clients

[Ralf34sq]

What b0ll0cks. Unless you have been asleep for the last 3 decades you would know that entire countries are surviving (thriving)on the outsourcing industry. There is a constant net flow of work offshore. Clearly all the top management of the entire fortune 500 didnt get your memo.

Totally agree. I work in a mixed model myself among local and offshore resources and quality is high across the board. Leading up to the now postponed deadline, the client had been considering moving everything offshore. So I am among those who see the changes as detrimental to the our economy.

[AnthonyQuinn]

Have you ever seen the quality of offshore work? The only people who think it is a good idea are managers without any technical background who resent paying for quality software.

What b0ll0cks. Unless you have been asleep for the last 3 decades you would know that entire countries are surviving (thriving)on the outsourcing industry. There is a constant net flow of work offshore. Clearly all the top management of the entire fortune 500 didnt get your memo.

[gables]

Come, come now. Lack of sympathy does not equate to petty spitefulness.

I'm confused

[SussexSeagull]

The way some people talk you would think every contract ever entered into was at gunpoint. We have made a living out if contracting because there was a need and we fulfilled the need. They chose not to get in a Consultancy or, heaven forbid, employ some people.

Admittedly in the City (soon to be followed by everywhere else in all likelihood) demand has dropped due to external factors so there would probably be something of a contractor cull going on even if IR35 changes hadn't happened but there is still work to be done so they have the following options:

Consultancy (onshore or offshore or mixture of both) - No doubt varies depending on size but I imagine a consultancy contract is a damm site more watertight than a contractor one through an agency. Having worked with a few of them they don't really do flexible so if you change your mind it will cost you money to change it. Similarly you don't get the flexibility of telling the resource they aren't wanted if it gets canned.

Permanent employees - Not happening. Indeed one can almost hear the cogs ticking in recruitment as they see they can recruit temporary resource with no employment rights so why not recruit everyone that way? Which leads us too -

Temporary resource (Contractors and FTC) - If everything goes inside I am sure a lot of previously outside contractors will stay (despite the advice on here) or sign an inside contract next time. Entirely legitimate and legal but does reduce their financial spending and is going to push a lot of very good contractors into permanent jobs as they might as well have the benefits to go with the tax.

What hasn't been mentioned is expenses. This isn't much of a factor for anyone living and working in London but in less populate areas where they haven't got a local pull of talent, spending a £1,000 a month on expenses after tax is going to make lower end contracts non-viable so they are going to have to consider paying expenses.

To answer the original point of the thread the market will sort it out but for the foreseeable future it isn't top of our list of things to worry about.

[cojak]

As I recall he lived in a nice mews in Chelsea, his XJS was nice if like that sort of car.

Come, come now. Lack of sympathy does not equate to petty spitefulness.

[gables]

On his straw mattress?

As I recall he lived in a nice mews in Chelsea, his XJS was nice if like that sort of car.

[eek]

I don't know what your skill set is (I suspect there are a variety here clouding he discussion) but as a developer that is not true.

Client after client you see permies who are clueless compared to the contractors who carry the main workload. I handed a new system over to a BAU 'developer' not long ago and a year later he had dodged fixing any bugs or making any changes because he didn't know how to. I know many developers who have said if all the contract developers went permanent it will be very bad news for many existing permies. who will no longer have to be tolerated.

That says as much about you (and the terms of the contract) as it does about the developer...

[mockedguy]

And most clients have permies thar have the same skills as the guys being brought it.

I don't know what your skill set is (I suspect there are a variety here clouding he discussion) but as a developer that is not true.

Client after client you see permies who are clueless compared to the contractors who carry the main workload. I handed a new system over to a BAU 'developer' not long ago and a year later he had dodged fixing any bugs or making any changes because he didn't know how to. I know many contract developers who have said if all the contract developers went permanent it will be very bad news for many existing permies. who will no longer have to be tolerated.

[webberg]

One of the many ironies in this situation is that for years and years contractors were told that routing money via a PSC was a "guarantee" of being outside IR35.

This is false.

Now we see end clients banning, not contractors, but the use of PSC's. The reasons they are being told by their agency contacts is that a "PSC looks prima facie as though an inside IR35 gig is being manipulated to be outside".

This is also false.

The hypocrisy of the agencies is stunning. Use a PSC to be outside Ir35 and then drop the PSC becasue it means you are inside IR35 (and we may not get our commission).

[northernladuk]

Working Inside has been available since April 2000. In fact earlier, like forever; mid 90s I was working with a PM who paid himself a PAYE salary based on his full LTD income, no dividends, no income splitting - he slept well at night.

On his straw mattress?

[gables]

And the 3rd paragraph not.

Inside is an ok compromise, but contractors have been forced over the years to work through PSC by companies who wanted highly skilled temporary resources (i.e. not employees), not of their own choosing. Would have been easier if Inside had been brought in many years ago.

Working Inside has been available since April 2000. In fact earlier, like forever; mid 90s I was working with a PM who paid himself a PAYE salary based on his full LTD income, no dividends, no income splitting - he slept well at night.

[northernladuk]

But that's an entirely different matter - as we can see with IR35 what the law says and company policy may be entirely different (especially when companies don't, usually for good reasons, trust their staff).

Indeed but we are going off topic from the context of the reply.

[eek]

Very good point. Can but often don't want to.

But that's an entirely different matter - as we can see with IR35 what the law says and company policy may be entirely different (especially when companies don't, usually for good reasons, trust their staff).

[northernladuk]

Businesses can engage with sole traders - agencies can't...

Very good point. Can but often don't want to.

[cojak]

Everything that everyone above says.

On CUK there are Professional Forums where people are informed about things such as Professional Insurance, accounts and accounting, IR35, taxes, we are anti-tax avoidance schemes, we are pro-IBOYOA (look it up, that’s what we do), 24-month rule, etc.

I even wrote up a thread to on how to decide whether people to stay or go after April in September.

All contractors need to do is be curious and google this stuff up and inform themselves, they don’t even need to use CUK.

But permitractors don’t. They are not curious, they don’t care other than making sure the money goes into their account at the end of the month whereupon they spend it. They are not interested in the nuance of working for the same clients for multiple years. Most will have enough to pay the tax their accountant tells them to pay but some won’t, relying on luck to see them through.

Sometimes it feels that I am just yelling into a bucket, hearing my own voice yelling back at me.

We will give advice but we are increasingly unsympathetic with these contractors if they come here weeping “it’s not fair!”.

Edit: oh, and don’t forget warchests. We LOVE warchest, the bigger the better. Three months minimum, 6 months best practice.

Forgot those warchests...

The contractors we feel sorry for are those who were curious, who did read up, who did consider the risks of IR35. Those who left and are unable to find another contracts, contractors who went permie and are now facing redundancy, and those who are seeing their precious warchests shrivel in the face of IR35 and COVID-19.