Risk premium?

[webberg]

If the new world of 2016 is as bad as painted with taxed T&S and perhaps an increased risk of IR 35 applying, is the simple "remedy" of charging a higher daily rate going to be met with

1. No

2. Become an employee

3. Use a Ltd and take the risk

4. Something else

[pjt]

If the new world of 2016 is as bad as painted with taxed T&S and perhaps an increased risk of IR 35 applying, is the simple "remedy" of charging a higher daily rate going to be met with

1. No

2. Become an employee

3. Use a Ltd and take the risk

4. Something else

I hope not but I'm currently pessimistically assuming the answer to a rate increase will be No. Option 3 wont be an option as far as I understand as the client will have the final say on the risk and they are likely to 9 times out of 10 avoid any risk.

[northernladuk]

Who mentioned increased risk of IR35 past Apr 16?

And it will be number 1 in a vast majority of cases. Our taxation issues are non of the clients business.

[DotasScandal]

If the new world of 2016 is as bad as painted with taxed T&S and perhaps an increased risk of IR 35 applying, is the simple "remedy" of charging a higher daily rate going to be met with

1. No
2. Become an employee
3. Use a Ltd and take the risk
4. Something else

If the new world of 2016 is as bad as painted with taxed T&S and perhaps an increased risk of IR 35 applying, I foresee a dislocation of the contractor market, and chaos that will make the first coming of IR35 look like a walk in the park. I'll answer for myself, but I suspect I won't be alone in my thinking.

* 1/ Definitely - with most organizations in (more or less radical) cost reduction mode (despite Osborne's economic miracle...), mechanical rate increases have zero chance of being accepted.
One just has to look at the regular "across the board" rate cuts at major banks, which used to be a rarity just a few years ago, and now are practically an everyday thing. For many, rates have been flat at best over the past 5 years or so.

* 2/ Very possibly - this in turn will be met with a "No" from many a contractor. Contrary to what HMRC claims, employees and contractors VERY RARELY do the same job, though of course when observed from a distance by someone who knows nothing about the subject matter, it all looks like same.
I for one would NEVER accept doing the kind of stuff I am doing now if I did not have the flexibility that contracting gives me. I would go do something else entirely.

3/ Most likely.

4/ On the high-end of the market, I foresee more British contractors foraying into more welcoming locales and more foreign contractors skipping the UK altogether, as it just won't be worth the bother anymore.
Translating to less revenue for Osborne and co. in the end.

[Zero Liability]

Any changes to IR35 will likely come in from April 2017, not 2016. For now it's just the dividend tax and potential changes to T&S that are in the works.

[d000hg]

If contractors en masse demand higher rates, supply and demand will take effect - however increased costs may have a knock-on effect that companies change their attitude to using contractors in the first place.

[TheFaQQer]

Any changes to IR35 will likely come in from April 2017, not 2016. For now it's just the dividend tax and potential changes to T&S that are in the works.

IR35 needs a consultation and an Act before it can become law. But that doesn't mean that it won't happen in 2016.

We'll find out at the end of the month, of course.

[TheFaQQer]

If the new world of 2016 is as bad as painted with taxed T&S and perhaps an increased risk of IR 35 applying, is the simple "remedy" of charging a higher daily rate going to be met with

1. No

2. Become an employee

3. Use a Ltd and take the risk

4. Something else

I suspect a combination of 2 and 4 - become an employee on a zero hours contract working for a consultancy.

[jamesbrown]

IR35 needs a consultation and an Act before it can become law. But that doesn't mean that it won't happen in 2016.

We'll find out at the end of the month, of course.

Anything is possible, but this is unlikely in practice, unless they take a completely different approach (i.e. nothing like IR35). They explicitly put FB 2017 as a placeholder in the summer budget documents, which is a tacit acknowledgement of the need to consult widely.

[northernladuk]

The Op seems to be posting a lot on the upcoming changes but I'm still not convinced he's totally understood it and is just firing random shots off.