What do you think will happen to agencies next April?

[ASB]

the only thing that got me here was the 45ppm, and that wont last long at this rate before I hit 10,000 and it drops to 20, I also claim the £10 per day Subs, (2 meals)

Obviously you haven't been in the same geographic location for 2 years but impact:-

Currently you get - in effect - to spend 58.60/per day of gross income in order to do the role.

If you are operating low salary/high dividend then it will be 74 to produce that income. So that is 15 quid a day worse off.

If inside IR35/brolly and a standard rate taxpayer then it will be about 98. 40 quid a day worse off.

As a 40% tax payer the it will be about 55 quid a day worse off.

That's quite a big change, and before factoring in new dividend tax or forced into IR35.

That level of change is bound to make quite a lot of people question whether they should perhaps do something else.

=======================

Edit. Checking it on a salary calculation it's not that bad.

Edit: Ran the calculations in a different way, still pretty awfult butnot so bad.

Assumption, salaried and total billing 80k, expenses 12,500.

With T+S

Exps: 12,500
Er's Ni: 7201
Salary: 60,300

Net 42,300


No T+S:

Er's NI 8717
Salary 71280

Net Salary in hand 48,688
After expenses 36,188


So, worst case likely to be 6,200 a year worse off. Still pretty chunky though.

[Yonmons]

That makes quite horrendous reading !

[northernladuk]

£10 a day for two meals? You've applied for dispensation?

That's a hell if day! I'd only do that carry on for the top end of my rate!!

[The Spartan]

£10 a day for two meals? You've applied for dispensation?

That's a hell if day! I'd only do that carry on for the top end of my rate!!

Depending on where you are £10 isn't exactly a lot NLUK

[northernladuk]

Depending on where you are £10 isn't exactly a lot NLUK

Indeed but the £10 receipted for two meals needs dispensation doesn't it and I didn't think that was easy to get nowadays. Just wondering if the OP was claiming dispensation rates without it. Minor point really.

[The Spartan]

Indeed but the £10 receipted for two meals needs dispensation doesn't it and I didn't think that was easy to get nowadays. Just wondering if the OP was claiming dispensation rates without it. Minor point really.

Yeah I wouldn't claim it if I didn't have receipts, I always tend to stick to receipted amounts when claiming.

[GB9]

You are assuming that the agency model will stay under that definition.



If you assume you first point then clients will have a choice, adapt or pay more. In my experience they will adapt. It is a symbiotic relationship between Client, Agency and Contractor.

I can see 6 months of absolute chaos and quite possibly few roles available until everything settles.

Some clients will want d&c, however, given the option of that or additional cost, many will go for the cheaper option. Many clients I have worked for don't want additional employees or the overhead involved in managing them. The easy way to avoid this would be no d&c.

I can also see a situation whereby clients choose d&c, end up paying employers NI and attempt to drop rates to compensate. At the same time contractors will be looking for increased rates to compensate for dividend tax. And quite a few clients will offer more fixed term contracts, the arse-end of the contract market.

I won't be able to take roles down south, and vice versa for others.

If someone doesn't get a grip then this whole shake up has the potential to be one huge ....choose your own wording....

[suityou01]

I can see 6 months of absolute chaos and quite possibly few roles available until everything settles.

Some clients will want d&c, however, given the option of that or additional cost, many will go for the cheaper option. Many clients I have worked for don't want additional employees or the overhead involved in managing them. The easy way to avoid this would be no d&c.

I can also see a situation whereby clients choose d&c, end up paying employers NI and attempt to drop rates to compensate. At the same time contractors will be looking for increased rates to compensate for dividend tax. And quite a few clients will offer more fixed term contracts, the arse-end of the contract market.

I won't be able to take roles down south, and vice versa for others.

If someone doesn't get a grip then this whole shake up has the potential to be one huge ....choose your own wording....

Yep. Just waiting for someone in authority to cotton on. Mexican standoff until they do. But they will.

[BolshieBastard]

I can see 6 months of absolute chaos and quite possibly few roles available until everything settles.

Some clients will want d&c, however, given the option of that or additional cost, many will go for the cheaper option. Many clients I have worked for don't want additional employees or the overhead involved in managing them. The easy way to avoid this would be no d&c.

I can also see a situation whereby clients choose d&c, end up paying employers NI and attempt to drop rates to compensate. At the same time contractors will be looking for increased rates to compensate for dividend tax. And quite a few clients will offer more fixed term contracts, the arse-end of the contract market.

I won't be able to take roles down south, and vice versa for others.

If someone doesn't get a grip then this whole shake up has the potential to be one huge ....choose your own wording....

Extremely naive imo. Clients want contractors then treat them like employees so they already exercise D&C to some extent. The supervision context is so broad virtually every contractor will be caught. And I dont think clients will look for the cheaper option at all.

They wont pay increased rates as they dont see our 'expenses' as their concern.

All that's going to happen is that current government contracts will start to look more appealing if they are on your doorstep.

[psychocandy]

Extremely naive imo. Clients want contractors then treat them like employees so they already exercise D&C to some extent. The supervision context is so broad virtually every contractor will be caught. And I dont think clients will look for the cheaper option at all.

They wont pay increased rates as they dont see our 'expenses' as their concern.

All that's going to happen is that current government contracts will start to look more appealing if they are on your doorstep.

Bolshie - spot on. I dont think clients will care a jot.

What will happen is there will be less candidates because less will want to travel because of the costs. And the 7.5% will make the rate less in effect.

Then clients will just moan they cant get people but nothing will happen.