back to article BAE Systems tosses its contractors a blanket... ban on off-payroll working under upcoming IR35 tax reforms

Ahead of IR35 private sector rules, defence firm BAE Systems has issued a blanket assessment on all its contractors and freelancers that forces them into PAYE terms regardless of their individual circumstances. The notification email, sent out by BAE's Indirect Procurement Team in late January, says that assessments were made …

  1. Anonymous Coward
    Anonymous Coward

    Retired JIT

    Not only am I the first commentard (AC), but I can happily recount that I retired just in time to avoid this mess.

    1. Rob007

      Re: Retired JIT

      I did the same

      1. jeffdyer

        Re: Retired JIT

        Why are you bothering reading this then? I'd be down the pub.

        1. Anonymous Coward
          Anonymous Coward

          Re: Retired JIT

          Who's to say they are not down at the pub?

          ElReg while you are supposed to be doing something else is habit forming....

          1. Anonymous Coward
            Anonymous Coward

            Re: Retired JIT

            I am not retired yet... but can vouch that Reg with a pint is much more fun!

            1. Anonymous Coward
              Anonymous Coward

              Re: Retired JIT

              If BAe think everyone falls within IR35 why aren't they forced to employ, well, employees?

              Most of their money comes from the public purse so why are BAe getting away with not paying into society by employing, er, employees and providing the legal mandated social respomsibilities?

              Why does the HMRC / Government allow big business to walk away scot-free from their liabilities yet just wreck small businesses?

              1. BebopWeBop
                Headmaster

                Re: Retired JIT

                Do you really have to ask your last question?

    2. Harry Kiri

      BAe

      Well I'm waiting for the determination from BAe at this very moment. The agent won't push as he's scared of upsetting them. HMRC have made sure that there is no incentive for Contractees to come up with an accurate determination, if you put everyone inside you're fine, there is no punishment if you falsely over-tax - and what exactly is the path for Contractors to get a review? There isn't one. This is not how a democracy works. This is not how a fit-for-purpose HMRC would work.

      Still, if HMRC go after the PwCs, Andersons, Mckinseys, Sercos next (a service contract must surely be disguised employment), plus they tax Amazon, Facebook and Apple at 65% of turnover then at least all things will be equal.

      1. Dr. Mouse

        Re: BAe

        "there is no punishment if you falsely over-tax - and what exactly is the path for Contractors to get a review? There isn't one."

        I think there is likely to be a test case brought challenging a determination in the near future. It will be interesting to see what form it takes and how it goes: Will it be a contractor suing their client for a wrong determination, a FTT case for over paid tax, or something else entirely? Will any of these even be possible, given how the law is worded? Will there be any legal mechanism to challenge this?

        1. Harry Kiri

          Re: BAe

          That's a very good point and soon Contractors within IR35 will be suing Agencies and Contractees left, right and centre - the first time someone is seriously ill and needs a substantial time off (or paternity leave, or even bank holidays) there'll be legal action, someone other than contractors are going to get stung and this thing will either be dropped or a dose of realism put in place.

        2. Anonymous Coward
          Anonymous Coward

          Re: BAe

          > "I think there is likely to be a test case brought challenging a determination in the near future. "

          I'm surprised it hasn't already happened after the Public sector switched. Give it a few years. It needs to be a previously outside IR35 contractor who stays put when being switched to inside, and stays for several years to allow the amount of extra tax taken to build up to a sufficiently high enough sum to justify the costs of the case.

          Or IPSE need to get another IR35 warchest fund going, like the one I contributed to back in the early naughties when it was the PCG and on behalf of all contractors, we took the gov't through a Judicial Review of IR35. They could stick a £100 supplement on the IPSE membership for a year and fund it that way.

      2. TheMeerkat

        Re: BAe

        It is always someone else you want to tax, not you? So typical.

        1. Wayland

          Re: BAe

          Tax is robbery. Notice how the companies don't want to challenge IR35 because of the HMRC threats and in the case of BAE they pass the threat on down to the contractors.

          Nobody wants to be taxed or else it would be a voluntary contribution. So if anyone is to be taxed then it should all be the same rate. The big companies should be on PAYE as well as the small ones. Why should they only get taxed on profit? If they have equipment and labour costs then pay tax first and pay those expenses with what remains. Then if there is any money left after that then pay corporation tax on that.

          Yes it sounds unfair but then tax is robbery. Now perhaps you get why it's perfectly justified to do anything and everything to avoid paying tax.

          1. Androgynous Cupboard Silver badge

            Re: BAe

            > it's perfectly justified to do anything and everything to avoid paying tax.

            As you clearly have no use for arts funding, schools, public hospitals, unemployment or sickness benefit, roads, parks or international aid, can I please suggest you fuck off and live on an isolated rock somewhere and let the rest of us try and manage our society? Thanks.

            1. ShadowDragon8685

              Re: BAe

              I hear Rockall is absolutely ghastly at all times of year, and available for let immediately.

            2. Dave 15

              Re: BAe

              Not what the guy said at all if you read his post. What he said was getting a properly level playing field where the rich people and large companies pay the same proportion as the rest of us. Further if you wind your neck in a little a vast amount of gvmt expenditure is on foreign police cars, foreign fighter jets, paid to foreign landlords and more, all of this is money, hence demand and jobs, being sent out of our country by our own government. A BMW police car is NEVER cheaper than a British built NISSAN FOR THE British economy, as the French, Italian, Spanish, Germans, Americans, Japanese even Swedish realise which is why none of them ever buy foreign built police cars.

          2. Dave 15

            Re: BAe

            I don't understand the downvotes after all ir would be better and cheaper for us as people if the likes of Amazon, Starbucks etc. Paid their fair share of tax. The corner shops will do better as well because they have to pay tax here without being able to shelter profit in off shore havens as the big companies can and do. If we also went for a single flat benefit we can also do away with tax allowances and allow more people to pursue an idea and become small business. Perfect sense and if it was well done the whole of hmrc, the dept of social security, all those local gvmt accountants and tax collectors,, those chasing tv licence et al could be replaced by a laptop in the corner of no 11

  2. Pascal Monett Silver badge

    "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

    Nope, not a chance. With all the contractors that have left already, are on their way out or planning to be, HMRC will be lucky to get a quarter of that.

    And when they've all walked, you'll be left with companies that cannot complete projects in the initially projected timeframe, at the initially projected cost and, in some cases, will not be able to complete the project at all.

    If you're going to issue a blanket assessment of your contractors, then just hire them officially already. This whole situation is not only ridiculous, it does nothing to help the post-Brexit performance of the economy. Quite the contrary.

    1. Sykowasp

      Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

      The problem is that BAE don't want to hire them as full time employees at a higher rate of pay to compensate for the change in employment arrangement - and that's even if the contractor is willing to have the change - maybe they like not having employment benefits, or only want to work 8 months a year (which would normally not fall under IR35, but if BAE are doing this they will not have a choice).

      Because what happens then is the rest of the workforce notices and says "this person is doing the same role as me, but being paid 50% more" and then that leads to major issues.

      But ultimately, we all know that contractors have been getting a sweet deal - higher pay and lower taxes - so few in the real world are crying for them.

      1. DontFeedTheTrolls
        Headmaster

        Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

        "or only want to work 8 months a year (which would normally not fall under IR35..."

        Wrong. The length of the contract is irrelevant. You can be contracted for one day and be inside IR35. It comes down to control, where, when, and how the job is done, and any financial liablility. Now it is likely you could argue one day is outside, but there are no objective measures in IR35, only subjective assessments of the working conditions. And this is the major problem, it is subjective, not objective.

        1. fwthinks

          Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

          Previously when specific guidelines were published, all that happened was contractors/agencies/businesses modified the contracts to include specific statements that would be used as a means to justify being outside of IR35. Contractors and businesses were complicit in this game of moving the goalposts. The "substitute" agreement is typically in most contracts, but both the company and contractor know this will likely never be invoked or tested. In most cases its is completely impractical and could never work. Most businesses take several days/weeks to onboard new contractors and no company would allow a complete stranger to just walk in one day and have access to their IT systems. Advance planning may be possible in some cases, but not in any of the companies I have worked for.

          So I am sure if HRMC stated that any contract less than x months would be outside of IR35, then suddenly you will see a massive spike in people changing their contracts to justify being outside of IR35. When in reality, nothing changes in the office on a day to day basis.

      2. Anonymous Coward
        Anonymous Coward

        Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

        But of course they have. Yes, there is the risk that the contract can be terminated at any point. Hell, even if the client so decides that you're not needed for a couple of weeks then no work, no pay.

        But then you are probably the kind of gutless person who will bitch about contractors and their pay but yet like your cushy number with your sick pay, holiday pay, pension, redundancy and so on. You highlight all of the upside of contracting but none of the downside.

      3. Addanc

        Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

        If my recollection is correct at one time PCG/IPSE had challenged and won over 1500 IR35 case compared to a literal handful won by HMRC; if correct the statement that on 1 in 10 contractors pay the correct tax is a LIE.

      4. Dave 15

        Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

        First contractors do not have a sweet deal, higher rates than the rest get pay but less benefits, less training, no paid holiday, no sick pay etc etc. If others think it is sweet they are always welcome to leave their safe job and go contracting. If HRC thinks contracting is the same as a normal job they should force companies to employ us as normal people on normal conditions.

        In the meantime all contractors should leave BAe now and not return until BAe offer a proper job at a good wage or look again at blanket decisions

    2. ArrZarr Silver badge
      Joke

      Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

      "...you'll be left with companies that cannot complete projects in the initially projected timeframe, at the initially projected cost..."

      Because projects are famous for coming in on time and under budget.

      1. eamonn_gaffey

        Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

        ...especially with all those expensive and rate chasing 'contractors' :-)

    3. Dave 15

      Re: "[HMRC] has predicted the reforms will recoup £1.2bn a year by 2023"

      The contractors need to get together. Either we are all employed properly with 3 or 6 month notice, all the employee benefits and a sensi le salary or all should walk out

  3. dajames

    ... by grouping employees together, BAE did not show what HMRC calls "reasonable care." A draft manual to be released by HMRC when the legislation goes live in April states that applying the tool to "a large group of workers who have some variation between the work that is being carried out" is a big no-no ...

    So ... reading between the lines ... HMRC have suddenly realized that it's too expensive for them to look in detail into the individual circumstances of everyone operating a PSC, and they've decided to pass that cost onto the clients of the PSCs.

    The clients are not supposed to apply the rules with such a broad brush, but it's cheaper and easier for them to do so, so (at least as a first response) that's what they're doing.

    Methinks we have to wait for a few test cases in which the big users of contractors get rapped across the knuckles for applying such a broad brush, and we'll be back to something like where we were before.

    1. Dr. Mouse

      I think that's a part of the answer.

      Another part is that HMRC's interpretation of the rules is wrong, and has been shown to be in court many times. However, by making that interpretation the basis for CEST and scaring companies with the prospect of expensive investigations and large tax bills, they get their way even though it is not in line with the law.

      I don't blame companies for their approach, especially Ltd bans. On the one hand, they can spend lots of man-hours assessing each contractor individually, and then risk said investigations and tax bills by accurately confirming an inside IR35 status. On the other, they can ban Ltds, take a hit on those who leave, and hope to recruit from the newly-available talent pool. Both approaches carry risk, but the second looks less scary.

      1. Doctor Syntax Silver badge

        "On the one hand, they can spend lots of man-hours assessing each contractor individually"

        Or they could hire those contractors the same way as they hire, say electrical contractors to do a wiring job.

        1. ExampleOne

          > Or they could hire those contractors the same way as they hire, say electrical contractors to do a wiring job.

          What? On a “per job” basis? How will they know he is working the 8 hours a day they are paying for if they do that?

          1. Sir Runcible Spoon

            Simple, if the 'wall' doesn't get built, then the builder wasn't on the job.

            Contractors should be paid on results, not time spent in a seat looking at a screen.

            1. Aristotles slow and dimwitted horse

              What an idiotic and logically flawed comment.

            2. ExampleOne

              Um... I think my point was that many of the contractors in question are not being hired to do a job, they are being hired as an FTE with easier disposal but a higher price to compensate.

              There may also be some manipulating headcount for market reasons going on as well For the public ally listed companies.

              1. Anonymous Coward
                Anonymous Coward

                The higher price is to HMRC - since employing contractors is generally cheaper for companies than employing someone on a permanent contract. I discussed this over drinks with the financial head of one company I was working at, since I was amazed at the high ratio of contractors to permies (roughly 60-40). She explained that the cost of employing contractors was lower since the company paid less tax and no holiday or sick pay.

                It was an eye opener for me, since I'd always assumed up to that point that contractors were employed because they were highly skilled and could therefore demand high rates. Something I was quickly to find was bollocks, since most of the incompetent people I've had to work with (both as a contractor and permie) were contractors who would generally wing it for 6-12 months and then move on.

                1. EnviableOne

                  HMRC dont lose out too much, as the costs that would fall on the company, fall on the contractor or their PSC.

                  the higher rates are based on the liabiliteis that the contractor has to bear, and the company does in the case of employees.

                  Most contractors should not be Inside IR35, although the ones at the bigger firms are more likley to be.

                  Contractors provide a flexible resource for SMEs that cant afford skills on a full time basis, or only require them for specific projects, to enable our country to thrive.

                  Irrespective of your personal feelings, the IR35 rules are auful, they are indescriminate, illogical, and open to all kinds of interpretation.

                  then there is the status of contractors deemed inside. They are effectivley employees without the rights or protections of one. There will be some unscrupulous firms that create these roles and we will have an underclass of sudo-employees.

                  The reason why the CEST is auful is the contractors working on it, got demed in IR35 and left HMRC before it was finished.

                  1. Sir Runcible Spoon
                    Headmaster

                    "an underclass of sudo-employees."

                    Wouldn't that actually put them in charge? Unless you meant 'pseudo' of course :P

        2. cosymart
          Big Brother

          Issues...

          "Or they could hire those contractors the same way as they hire, say electrical contractors to do a wiring job."

          There are issues with this: 1) The company will need to fully spec the work to be done and 2) The contractor will need to fully spec how they intend to carry out the work.

          Might make for interesting conversations on both sides :-)

          1. ExampleOne

            Re: Issues...

            Not really, assuming both sides are being reasonable.

            I certainly couldn’t fully specify electrical work for an electrician I hired, I trust him to be able to translate my desires (e.g. power socket here) into a fully specified job and deliver. Somehow I haven’t had issues not having been able to fully specify all the electrical backing to those sockets. In fact, that is pretty much why I hire professionals for this kind of work.

            1. truetalk

              Re: Issues...

              I certainly couldn’t fully specify electrical work for an electrician I hired, I trust him to be able to translate my desires (e.g. power socket here) into a fully specified job and deliver.

              Don't think you've had to deal with the trades much. All the ones I've dealt with have needed a little more detail than a power socket. There's hundreds of not thousands of types and styles, not to mention what are you going to connect to it. A toaster or an x-ray machine. Big difference.

              A full spec makes sure everybody knows where the blame and costs go when and if the shit hit the fan. Hopefully when everybody knows what's required that's less likely.

            2. chiggsy

              Re: Issues...

              Thanks for sharing. So, ah, you feel that enterprise level programming is on the same level as house wiring?

              I think it's more complex to be honest. Your creed of handwaving specs is costing you money every project.

          2. Mike 137 Silver badge

            "[...] need to fully spec [...]"

            Of course both sides would have to specify the requirements and conditions. I always thought that was called a contract for services. My contract terms as a service provider explicitly require that, including formal management of any modifications to the spec from either side. The relevant problem with IR35 (among all the others) is that it ignores the terms of the contract, so the entirely legitimate contract between myself and the client might as well not exist.

            But these blanket decisions are just the thin end of a wedge that will lead to zero rights employment, whereby HMRC will get the tax but the worker will have no security, saving the client all the costs of pension, holiday pay, sickness benefit and worker expenses.

            1. Wayland

              Re: "[...] need to fully spec [...]"

              A friend who contracts in Germany gets all the employee rights. When he stopped working they had to pay him redundancy. When he was ill they had to keep paying him too.

          3. Dave 15

            Re: Issues...

            It would doubtless be a very useful conversation, followed by the obvious move to working on the project from home (my office) as I have a particular thing to deliver and not time sat in discussions. This could form a 'new' route for parties as well, and would cut down on commutes, office space requirements and of course CO2 emissions

        3. Wayland

          I used to contract that way. When ever they needed a mod to a program I'd price it up and they'd write me a purchase order. I used to have a whole bunch of POs on the go at the same time. Different departments would write me POs. Sometimes they'd just send me a PO and one line saying what they wanted done. These ranged from £300 to £5000. I could do the work on site or back at my office. I could get my employees to do the work.

          You'd think I'd have been immune from IR35 but when it came out the client panicked and tried to get everyone on an IR35 contract.

    2. DontFeedTheTrolls
      Pirate

      Big Business: "we'll consider individually which roles are inside IR35 and which are outside IR35"

      HMRC: "We consider all these people were inside IR35, give us this x millions in NI and Tax NOW, and if you win the case in court in 18 months time we'll give you the money back."

      Big business: "fuck that, every role is inside IR35"

  4. elwe

    People are still getting mixed up between being an employee under PAYE and a permanent employee. You can be the first without being the second.

    The way things are going very few businesses will use contractors via personal services companies, but they will still use 'contractors'. Those 'contractors' will be on zero hours contracts and be paid via PAYE. Being zero hours they won't get sick pay, but will get holiday pay (work x days get an additional days pay), pension enrolment after 3 months and all the other things employees get. Rates will probably rise a little to reflect that travel to work expenses are no longer tax free, but otherwise not a lot will change. People can still work flexible, short term contracts, for multiple employers etc. But those employers will be paying the employers NIC, not their personal services company, so the scope for using dividends, expenses and a salary to the wife to reduce the amount of tax paid will disappear.

    1. Jellied Eel Silver badge

      Expenses..

      Rates will probably rise a little to reflect that travel to work expenses are no longer tax free..

      That one could get interesting. So I've been a nomadic contractor, ie jetting off to parts unknown to design/build networks. I guess I've been fortunate that those have been outside IR35, but curious how expenses will work for insiders. Like where you are employed being rather key to what you can claim on expenses, and how employers will treat those. I think they're often one of those myths about expenses being 'tax free' being some kind of benefit, when the reality is they're a cost.. Especially given rules like 5/7ths for T&S.

      1. John Brown (no body) Silver badge

        Re: Expenses..

        As an employee, travel expenses are not payable from "home" to your regular place of work. If your job is made redundant but you get deployed to another site, you can claim travel costs for up to 12 months at public transport rates, eg bus fares. I'm not sure if you have to actually keep and show those bus tickets since that never actually happened to me. If you have a company car, again, you can't claim mileage from "home" to your usual place of work unless, like me, you are based from home and travel every day to different customer sites, ie are not office based. If you are office based, you pay for your trip to the office, then travel from there to wherever at company expense, even if that means traveling 20 miles east to "work" then traveling back west to that days ob sire next door to your home, the traveling back to the office, then finally traveling home.

        1. Jellied Eel Silver badge

          Re: Expenses..

          As an employee, travel expenses are not payable from "home" to your regular place of work.

          Yup. Thats where I see it getting complicated. So suppose..

          I'm contracted to BAE @ SW1Y 5AD. The contract is due to be performed in say, Barrow*. Which would mean that's my usual place of work for performance of that contract, which means not being able to expense T&S for living their, or commuting between Barrow and 'home'. Mainly because HMRC would probably dispute where the usual place of work is if you tried claiming it was SW1.

          Which presumably means BAE would need to include T&S into salary, and pay relevant taxes/NICs on that instead of letting the contractor figure that out, and so their offer would need to be a lot higher. And it gets even more complex if usual place of work happens to be overseas.

          *Picking Barrow as I once had an agency call me about a contract to work on submarine cable systems there. I had fun trying to point out my experience wasn't on that kind of submarine, and the agency wasn't very.. astute. I'm sure those beasts have some fibre I could've spliced, and it would have been quite fascinating to crawl around the insides of our Navy's ninjas though.

          1. MyffyW Silver badge

            Re: Expenses..

            @Jellied_Eal Your example is both Artful and Audacious...

            1. Jellied Eel Silver badge

              Re: Expenses..

              Your example is both Artful and Audacious...

              That may have been true if I'd managed to blag an interview there, but more realistically may have resulted in Arrest :p

      2. nasher

        Re: Expenses..

        Hes some figures for a job 500miles away.

        12 month Contract worth £140000

        Income post umbrella company £76000

        post 12 expenses £39000

        outcome -> get a job collecting bins!

        1. tip pc Silver badge

          Re: Expenses..

          @£3250 per month in expenses i think your doing something not right, will the company you contract for not pay your reasonable expenses?

          1. nasher

            Re: Expenses..

            4 nights per week in hotel

            4 evening meals

            Taxi to airport

            Taxi from airport

            Flight to and from

            It all adds up

      3. Anonymous Coward
        Anonymous Coward

        Re: Expenses..

        Especially given rules like 5/7ths for T&S.

        Anyone care to explain what 5/7ths for travel and expenses means?

        1. Jellied Eel Silver badge

          Re: Expenses..

          Anyone care to explain what 5/7ths for travel and expenses means?

          Paperwork mostly. It's down to Ltd contractors wearing 2 hats, ie what's an allowable expense for the company, and then for the employee. So how to expense and account for tax when weekends get treated as a benefit in kind, along with weekend meals. And gets more complicated when accomodation costs are invoiced weekly/monthly, ie serviced apartment or bedsit vs hotel nightly charges.

    2. Doctor Syntax Silver badge
      Mushroom

      "People are still getting mixed up between being an employee under PAYE and a permanent employee. You can be the first without being the second."

      Until somebody decides to nuke one of the employers by going to an ET.

    3. This post has been deleted by its author

    4. Hans Neeson-Bumpsadese Silver badge

      People are still getting mixed up between being an employee under PAYE and a permanent employee. You can be the first without being the second.

      Indeed. I've been a PAYE employee on a permanent contract for a good number of years now, but did quite a number of jobs before that as a temporary employee, i.e. not as a freelance contractor.

      One was covering for someone on maternity, another was a few months to cover someone on long-term sick, others were for "we have a project running for <x> months and need someone to do <y> on it". Signed a contract of employment and became a employee on PAYE with the knowledge that after a set period of time my employment would come to an end.

      I think I spent around four years in full-time employment and in that time I only had one job with a permanent contract (the job turned out to be s**t and I resigned after a week).

      1. John Brown (no body) Silver badge

        But would you take a 3 month temp PAYE job 150 miles away while getting paid the rate for the job, just like the others working there?

        1. Hans Neeson-Bumpsadese Silver badge

          But would you take a 3 month temp PAYE job 150 miles away while getting paid the rate for the job, just like the others working there?

          To be honest, no. I have family so always looked for employers in my home city or within commuting distance.

      2. Mike 137 Silver badge

        Differences

        Contract of service employment (whether continuing or fixed term) is quite a different proposition from a contract for services. On a contract of service you're essentially under orders from the hierarchy and subject to the corporate culture whether it's a barrier to achievement or not. As an outsider on a contract for services, you can change that culture if necessary to achieve the required objective. A specialist consulting expert has to operate under a contract for services in order to be worth their fee.

        1. Hans Neeson-Bumpsadese Silver badge

          Re: Differences

          As an outsider on a contract for services, you can change that culture if necessary to achieve the required objective

          I don't believe that culture change is exclusively the preserve of an outsider on a contract for services. Where I currently work, there are a number of changes which have come from initiatives started by people on the inside, i.e. permanent staff members. Arguably they're better placed to initiate change because (a) they've been here longer so understand the culture better, (b) are known to management who respect their experience and so are more prepared to listen to them

  5. Anonymous Coward
    Anonymous Coward

    Interesting timing ...

    as the door to the EU slams shut.

    If I actually believed they had the competence to have arranged this, I'd suggest this looks planned.

    But as always, cock-up over conspiracy.

    1. wolfetone Silver badge

      Re: Interesting timing ...

      Paraphrasing it, but don't but down to malice what can be put down to stupidity.

    2. Jellied Eel Silver badge

      Re: Interesting timing ...

      If I actually believed they had the competence to have arranged this, I'd suggest this looks planned.

      It's been planned for over a decade, ever since lobbying groups decided it would be a good way to push contract work towards the big consultancy groups, and screw the independent contractors.

      1. iron Silver badge

        Re: Interesting timing ...

        But probably not planned to conincide with Brexit, which was his point.

        1. Anonymous Coward
          Anonymous Coward

          *HIS* point

          #everyday sexism.

          Why not "their" point ?

          1. Jimmy2Cows Silver badge

            Re: *HIS* point

            Would you have objected to "her" point instead? I suspect not.

            "Their" is typically for plural use. "its" would be singlular but is considered rude. There is no genderless singular equivalent that's considered polite.

            "His" is taken in this context to be singular and genderless, as would be "her's". The two are interchangeable and in no way sexist unless you're on dubious feigned moral high-ground trying to pick a fight.

            1. Anonymous Coward
              Anonymous Coward

              Re:"Their" is typically for plural use. "its" would be singlular but is considered rude

              Oh dear ....

              Me: "Hey, someone called for you."

              You: "What did they want ?"

              Singular polite use. Generally, it's not a great idea for techheads to lecture about the nuance of language.

            2. Weylin

              Re: *HIS* point

              Singular "they" has been in use for over 5 centuries.

          2. genghis_uk
            Trollface

            Re: *HIS* point

            Just go back to Twitter and leave the Reg comments alone

            Too obvious --->

      2. DontFeedTheTrolls
        Holmes

        Re: Interesting timing ...

        Just out of curiosity, were the lobbying groups you allude to owned or supported by the big consultancy groups?

        And were the big consultancy groups the same big consultancy groups HMRC engaged to investigate the issue and report on the potential tax implications?

        1. Jellied Eel Silver badge

          Re: Interesting timing ...

          Just out of curiosity..

          From memory, yep. For detail, it'd need digging back in time to when the idea was first floated. In practice, it benefits the usual suspects, except perhaps when jobs are too small for them to be interested in. Or it helped spawn the Umbrella Corps that act as intermediaries & take a slice of the fees. So contractors become PAYE employees of the Umbrella Corp, but with fewer rights that an FTE of the company contracting the umbrella.

          But generally it's a clusterfunk of epic proportions, especially when the idea is to encourage tech & a flexible work force. Big companies seem happy to go along with it given contractors become pseudo-employees and can still be disguised on the balance sheet.

  6. Alan Johnson

    Catch 22

    Another said their contract was terminated after they contested the blanket determination. "There was no discussion. I kicked up a fuss, and not long after, I got a call saying my contract had been terminated."

    Ironically proving that they were right and definitely not inside IR35 as clearly there was no mutuality of obligation. Amusing in a rather dark and sad way.

    1. Anonymous Coward
      Anonymous Coward

      Re: Catch 22

      So… that termination can now be taken to a tribunal based on the employer's assessment of the relationship?

  7. Ian Johnston Silver badge

    There is no reason why BAe cannot pay for employees travel and subsistence to Barrow or Lossiemouth, though if the place in question is designated the employees principal place of work the expenses will be taxable. Relax, dudes. All you're being asked to do is pay your fair share of tax and NI.

    1. Jimmy2Cows Silver badge

      Not this again.

    2. Anonymous Coward
      Anonymous Coward

      I'll tell you what....

      How about the day-rate that you're charged out as (presumably you have one) is taxed at 65% before your company sees a goddamn penny as you're a pseudo-employee of whomsoever you're contracted to?

      Maybe then that will focus a few minds.

      How come BAe works for the MoD (and they have supervision as well) and they get a day-rate for engineers and T&S, the contractors they employ (and don't forget THEY ONLY EMPLOY CONTRACTORS AS THEY DO NOT HAVE THE SKILLS THEMSELVES) - magically they're employees and have to pay 65% tax whilst still running a company.

      Just how exactly does this not just look like its picking on companies that cannot afford to fight the HMRC, lobby MPs or set up tax avoidance schemes?

    3. Anonymous Coward
      Anonymous Coward

      >There is no reason why BAe cannot pay for employees travel and subsistence to Barrow or Lossiemouth, though if the place in question is designated the employees principal place of work the expenses will be taxable

      Agree, Marconi's back in the 1990's did this for a group of employees (in their mid to late 50's) when they relocated a factory. The employees turned up at their former place of work and got a company paid for a coach to the new factory. This arrangement continued for 4+ years, Marconi's picked up the tax bill so that the employees were not financially impacted.

      All you're being asked to do is pay your fair share of tax and NI.

      Clearly not done the math or been reading the various articles on contracting, most contractors pay more tax to HMRC than employees, perhaps employees should, just like contractors, be paying VAT on their gross earnings...

  8. Doctor Syntax Silver badge

    I suspect all these companies have been engaging freelancers via their HR departments. HR only understand employment contracts. Would they let HR hire a builder to put up the shell of a new DC? Or an electrician to wire it up? Or an HVAC technician to install the cooling? So why let HR hire the people to set up the computers inside it?

    1. Anonymous Coward
      Anonymous Coward

      Because usually HR are just the enabler. The job spec and CV reviews are done by the relevant teams that need the staff.

  9. Dave 15

    It's worse even than this...

    MPs are apparently outside IR35, of course.

    But my company (and indeed my family home) is outside the UK and I was told I would be inside ir35.

    Cobblers, the whole idea is shit, they want to close down contracting entirely (after all if I am paying tax and NI as an employee I want the redundancy arrangements, sick pay, pension, job protection and paid holidays as well as the tax bill). Without the contractors the ability of companies to smooth the highs and lows of demand is seriously curtailed. What will happen, a guarantee here, is that contracting will cease and more jobs, money, experience and future prospects will land in Bangalore or eastern Europe, once again the UK loses out to brain dead politicians and anti British headline seeking civil servants. I wish I could free a glorious day when they all were put against a wall and shot

    1. Doctor Syntax Silver badge

      Re: It's worse even than this...

      "But my company (and indeed my family home) is outside the UK and I was told I would be inside ir35."

      That's an interesting one. I'd been wondering about what would happen if the contractors worked via, billed from and were paid by Irish registered businesses. It would, of course, depend on the terms negotiated with the EU but I'd think there would be serious problems if HMRC were to try interfering with commercial contracts with an overseas company.

      1. Jellied Eel Silver badge

        Re: It's worse even than this...

        That's an interesting one. I'd been wondering about what would happen if the contractors worked via, billed from and were paid by Irish registered businesses.

        I considered that. Corporation tax would be lower in Ireland, but payroll costs higher. I also thought about doing the Vodafone/M&S/Amazon thing and incorporating an SPV in Luxembourg, but can't remember the details. Main stumbling block was the potential for double taxation and the accountancy would have been more painful/expensive.

        ..but I'd think there would be serious problems if HMRC were to try interfering with commercial contracts with an overseas company.

        They'd argue they weren't. They're simply pushing compliance risk onto the hiring company, and it's not their fault if that means companies decide to stop hiring traditional contractors, and move to pseudo-employment. I guess the EU aspect would be whether that means companies are flouting employment laws by discriminating against contractors. I'm thinking given the cases involving self-employed gig workers, it'd be safer for companies to hire 'contractors' as short term FTEs.

      2. Roland6 Silver badge

        Re: It's worse even than this...

        I'd been wondering about what would happen if the contractors worked via, billed from and were paid by Irish registered businesses.

        Depends on who the owners of the Irish business are. If it is just yourself, a UK passport holder/tax payer then HMRC will treat this arrangement as tax evasion.

        1. Jellied Eel Silver badge

          Re: It's worse even than this...

          Depends on who the owners of the Irish business are. If it is just yourself, a UK passport holder/tax payer then HMRC will treat this arrangement as tax evasion.

          Not necessarily. Remember there are two distinct entities. The company, and the employee. So the company could be an Irish entity, in which case it would have to pay all relevant Irish taxes. The employee could be a UK national, and thus liable for UK taxes. Where it gets more complex is the 90/91 day rule which can catch out expats.

          Tax evasion could be assuming that because you spend <90 days inside the UK, you're non-resident & don't need to pay UK tax. HMRC frequently disagrees, and wins because to be non-resident means effectively severing ties to the UK. So if you keep a home here, pay mortgages, have a UK bank account etc, you're probably still liable. Then to complicate matters, if you're working in Ireland for >90 days, you could be deemed resident & liable for taxes there. Which can end up meaning double taxation and hassle reclaiming taxes, because you have to pay first, then dispute.

          I'd considered it mainly because I'd been getting a few international contracts, so there was a potential benefit in creating a Euro-zone SPV mainly to reduce bank charges & less than generous currency rates. Now it's an option for contractors, ie incorporate and work outside the UK, and pretty much by definition should be outside IR35, but HMRC may disagree.

          1. Roland6 Silver badge

            Re: It's worse even than this...

            >Not necessarily. Remember there are two distinct entities.

            From your supporting piece, there are two distinct operational modes. Firstly, using the Irish company as the vehicle for your services to UK-based customers and secondly, using it as the vehicle for your international (non-UK contracts). HMRC also views these arrangements differently, seeing the first very much as an artificial construct having the direct purpose of evading UK taxes - although you could probably successfully challenge that if the UK business is a small part of a much larger international business... whereas with the second arrangement things much depend on how your Irish company pays you for your services - interest-free loans being a definite no-no.

            Personally, I would look at the pros and cons of just having a company Euro/USD account - I did mine directly with a bank in France and so avoided double bank fees (UK bank charges for acting as an agent for their overseas branch, plus you pay whatever their overseas branch charges for their services), before going to the trouble and expense of incorporating in Ireland or elsewhere.

    2. DontFeedTheTrolls
      Headmaster

      Re: It's worse even than this...

      "MPs are apparently outside IR35, of course."

      Source? MP might not be a "job" in the tradition sense but they draw a salary directly from Parliament under PAYE and are not engaged through a Limited Company.

    3. Anonymous Coward
      Anonymous Coward

      Re: It's worse even than this...

      >But my company (and indeed my family home) is outside the UK and I was told I would be inside ir35.

      Don't see a problem.

      Whilst I don't agree with IR35, a job/post/contract is either inside of outside of it regardless of the actual circumstances of the company providing a person (and their circumstances) to perform the job/post/contract.

  10. Anonymous Coward
    Anonymous Coward

    Not alone

    Anon obviously, but the large law firm I'm currently working at has decided to shoot itself in the foot by demanding that all contractors must switch to PAYE/umbrella by April. Not surprisingly the majority are leaving.

    Unlike BAE there's no option to continue 'inside' through a PSC, they stated they've decided to sidestep making determinations either way with the move. The legislation will still apply of course, I'm just assuming they're hoping HMRC won't bother them if the contract workers are already paying the extra tax/NI/no expenses?

    1. Dr. Mouse

      Re: Not alone

      "The legislation will still apply of course"

      The legislation is all about Ltd contractors. If a business chooses not to take on Ltd contractors, the regs don't apply.

      This is why HMRC & HMT's statements that they will not affect genuine contractors is disingenuous. The law does not change how an Ltd contractor should be taxed, only who makes the determination, collects the taxes and is liable for it. However, by making that change they have made taking on a Ltd contractor much riskier and involving much more work. Therefore, the entire market is being shaken up and genuine contractors are being affected.

  11. alain williams Silver badge

    Long term result ?

    What will happen, a guarantee here, is that contracting will cease and more jobs, money, experience and future prospects will land in Bangalore or eastern Europe,

    Or the large consultancies/outsourcers like KPMG and Crapita will move in. So the cost per hour will inflate to pay for their inexperienced people. The net effect will be that the people cost of projects will increase.

    Those currently contracting (the good ones) will find close-to-home, decently paid properly employed jobs so the pool of temporary workers will dry up.

    Realization will eventually dawn that it is cheaper to increase the rate for good short term workers to compensate for the extra costs (& lonleyness) of working a long distance from home & other disadvantages.

    But IR35 was, from the start, driven by the large consultancies/outsourcers who did not like it that independent were undercutting them.

    1. Glennda37

      Re: Long term result ?

      or not... some of the banks are stopping their supply chain using contractors too...

    2. Anonymous Coward
      Anonymous Coward

      Re: Long term result ?

      I think the large UK consultancies have mistimed this move - I predict companies such as TaTa will be the ones taking over most of this work.

  12. Anonymous Coward
    Anonymous Coward

    This is illegal

    This is illegal against HMRC's rules and means that BAEs contractors have not actually received a valid SDS.

    From HMRC's ESM10014:

    Examples of behaviours which do not constitute reasonable care include, but are not limited to:

    - Determining that every worker who provides their services through an intermediary is caught by the off-payroll working rules without giving any consideration to the specific facts of each individual case.

    - Determining that the off-payroll working rules apply to a large group of workers who have some variations between the work that is being carried out, without giving proper consideration to the different working arrangements for each worker.

    1. ExampleOne

      Re: This is illegal

      I’m not sure how HMRCs rules requiring the client companies to “to give reasonable care” can be enforced against a “they are all on terminable contracts” defence.

      As one of the arguments for contractors is they don’t have security and can be terminated on a whim, I don’t see how HMRC can actually enforce the rule against a company that decides that under the new rules they have no interest in serving as government enforcers in yet another way. Any company making that decision could legitimately decide that they will no longer hire any contractor where they might even be asked to serve as enforcer, resulting in all such contracts being terminated whatever HMRC may say.

      Of course, this decision may also be idiotic in other ways, but sadly that is the company’s prerogative.

    2. Sir Runcible Spoon

      Re: This is illegal

      That may be so, but what can HMRC realistically do to a private company who makes their own hiring decisions?

      1. Mike 137 Silver badge

        Re: This is illegal

        " but what can HMRC realistically do to a private company who makes their own hiring decisions?"

        Possibly what they've done to single director private companies that hitherto made their own hiring decisions. The essence of IR35 is that a limited company contractor is no longer an employee of their own company.

        Possibly any damn thing they please as they can create regulations at will.

  13. nasher

    Destroying the mobile skill market

    Inside IR35 regulations result in travel expenses being paid post NI and post tax. Expenses away from home for a month is typically £2500 which will limit contractors a company can attract to the local area. The govenerment is going to stifle the grown of companies due to skill shortages and end up losing far more than they gain. Why can't we get someone who actually understands business in goverment?

  14. Anonymous Coward
    Anonymous Coward

    It's now feasible for all new workers to be engaged via an umbrella. Just think of the saving in pension contributions.

    What's good for the goose...

  15. Evolve

    Good ol' outsourcing will come in handy again

    If you want an example of the challenges posed by IR35, just take a look at Crossrail. The well-publicised delays to London’s ambitious engineering project have been caused – at least in part – by the HMRC regulation making it harder to retain skilled contractors. And it isn’t the only public sector project to have suffered.

    Now, private sector companies are also beginning to wonder about the implications of having to move their contractors to Pay As You Earn (PAYE).

    Will these companies still be able to attract and retain the best talent? And will they still be able to afford that talent as contractors increase their rates to offset their lost income?

    It might be that extended teams based overseas are their best bet of offsetting these concerns and remaining competitive. Just like UK companies rushed to outsource their IT and software engineering projects to Asia a decade ago in an urge to save costs and reduce OPEX, they can now get back to using this practice in an urge to overcome IR35. However, as many things have changed over the past decades, so has outsourcing. Now, UK companies can rely on local tech consultancies with a solid footprint in the offshore/nearshore markets and piggyback on their infrasctructure and R&D team capabilities, untapped talent pools and external expertise to build highly-efficient extended software teams and leverage offshore markets like Ukraine without having to invent kludges to avoid IR35 burden within the UK.

    As a Midlands consultancy with an off-site development centre in Kyiv, we've started seeing more incoming requests from local British companies that don't want to pay through the nose and are looking to extend their in-house teams to Ukraine to escape IR35 regulations.

  16. andolly53

    PSC no longer a loophole

    We've all known for years that if you want to earn a bucket load of cash then set up as a PSC and charge a day rate and pay yourself minimum wage and take dividends which reduces your tax and NI liabilities and chuckle at Mr paye sat next to you who is paying an additional 20-40% pa of tax.

    All this ir35 is doing is closing that hole. That gravy train has ended and contractor Bob now has to pay the same rates and paye Bill sat next to them doing the same job.

    Remember this cash is there to run the country, you know... fill those pot holes and keep those lights switched on in the hospitals etc.

    1. Anonymous Coward
      Anonymous Coward

      Re: PSC no longer a loophole

      And the complaints about not receiving the same benefits are ridiculous. The rate of pay is often getting on for double what someone on PAYE is receiving - which more than makes up for no sick pay etc, even ignoring the tax benefits you mention.

      Funny thing is, Reg comments are usually very left wing but as soon as it comes to fair tax for IT contractors they've gone all low tax Donald Trump.

      1. Sir Runcible Spoon

        Re: PSC no longer a loophole

        I don't believe most of the grumbling is down to 'paying more tax' (as a percentage, we already pay more tax overall) but that we are no longer able to run our companies from pre-tax earnings.

        The knock-on effect is going to reduce overall tax income for hmrc, although they will most likely only quote the extra few million they get from PAYE, totally ignoring the tens of millions lost in vat, corp.tax etc.

        For me personally it's more about the freedom to be my own boss and being able to invest in my business to develop new income streams. That's all being threatened now, I can't help feeling they are trying to put me out of business. It's almost as if no-one at hmrc believes there are *any* genuine contractors out there, and for them to say we should be unaffected is hubris of the highest order.

        1. Anonymous Coward
          Anonymous Coward

          Re: PSC no longer a loophole

          The hmrc believe that roughly 1 in 10 PSC's are set up in the correct manner, and from my experience I agree.

          In my working IT career of 20 years I can count on one hand maybe two at tops where a sole individual PSC has been brought in for thier skills / project.

          Whereas I don't have enough fingers and toes to count the PSC's where they have quit/'retire' the paye role to come back the following week as a 'consultant' same desk/same job/ 2-3 times the income. Go figure.

          So it may cause a bit of inconvenience for the genuine contractors while the ir35 whittles out the people taking advantage of this loophole and then things will settle down again. In the meantime Some business will knee jerk and will hurt thier business in the short term. They will quickly learn by thier mistakes and then adjust accordingly.

          1. Sir Runcible Spoon

            Re: PSC no longer a loophole

            "So it may cause a bit of inconvenience for the genuine contractors while the ir35 whittles out the people taking advantage of this loophole and then things will settle down again. In the meantime Some business will knee jerk and will hurt thier business in the short term. They will quickly learn by thier mistakes and then adjust accordingly"

            I get this, and even agree to an extent, but their [hmrc's] methods and shoddy definitions are hurting genuine contractors as well, and I reserve the right to be pissed at them.

          2. Anonymous Coward
            Anonymous Coward

            Re: PSC no longer a loophole

            The problem with this is as, someone who employs contractors it ignores the reason why I do it.

            The main reason is flexibiity in the number of developers. When things are going well we try to have 10%-15% contratcors when things are not going so well they are all dropped. We have never made an employee redundant but we have often got rid of contractors even to the point where we have none at all.

            The second reason is for a limited short duration project where it is known from the start that once that work is done the contract will be over.

            I don't know where your claim that only 10% of PSCs are steup correctly come from. I know that we have never engaged a contractor as a disguised form of employment. We did it fundamentally so we can get rid of them whenever we need to without significant, time, cost and damage to the morale of permenant employees who know we will shield them from short term ups and downs.

            What is interesting is when I use the HMRCs tool does not ask any questions about whether we would get rid of the contractors if we have a down term whereas to me it is the prime distinguishing factor between them and employees. As a small business we can make an assessment that IR35 does not apply but large businesses are very risk averse and the legal and HR departments who probably make this decision know nothing about the reality of why contractors are engaged so it is completely understandable they take the least risk apporoach. No one will be sacked for judging all contractors are inside IR35 whereas someone would be sacked for a claim from the HMRC even if the HMRC was wrong. The cost and effort of fighting the HMRC would probably itself be judged as too risky.

  17. ryokeken

    so what's the big deal? the market will work it out

    companies are going to pay up for what their cheating the government and the contractors out off.

    Isn't that how the market works? if you do t pay enough you're not gonna get talent to work for you. If you're not offered a raise or a permanent position then maybe it's time to sharpen them skills

    At least that's the view for NYC and USA where the government is small for the poor and socialist for the rich and incorporated :)

  18. MachDiamond Silver badge

    I'm good

    The new IR35 terms mean that contractors in the private sector will have to pay the same tax and National Insurance contributions as permanent staffers, despite not receiving benefits, such as holiday or sick pay, or parental leave.

    I'm past parental leave issues and I get more than enough days off. I'd rather get paid a premium rate for interesting short terms jobs than to be sat in an assigned cubicle being harassed by mangers that have little idea about what it takes to do my job. There are multitudes of reasons to bring somebody in as an independent contractor or full time employee. Not only could something need to be done that's a specialty and the position isn't necessary once it's complete, the work might be something that the company wants to have a clear ownership over and control its disclosure. The former is a good fit for a contractor and the latter a permanent employee. Get the government mixing in and the whole thing becomes a giant mess. There's always a way around these things and as other have commented, it often means that it's cheaper and easier to outsource from outside the country.

    1. Greg 16

      Re: I'm good

      The higher rate of pay covers the benefits. Everyone should be taxed equally.

      1. Anonymous Coward
        Anonymous Coward

        Re: I'm good

        What about pension contributions?

        *Everyone* else gets to pay into their pension tax free - not so inside-ir35 contractors. That's not being taxed equally is it?

  19. Anonymous Coward
    Anonymous Coward

    Funny but...

    I think people forget that running a PSC means paying more tax than you would for PAYE.

    If I was working 'inside' and shut down my company I don't have to pay corporation tax or pass VAT on my fees to the revenue any more. I gladly pay that now, as well as tax on dividends received. I don't see how the overall tax take goes up if HMRC turn people away from that model.

    Topically, I was offered a contract by an agent working on behalf of BAES recently. They wanted me to kick off all the onboarding and checks etc before knowing if it was inside or not. When I asked for an example of the contract that would be issued, they sent me an normal PSC one. Needless to say, I held off until they came back with a decision (inside, of course 3 weeks later) and immediately declined. It was almost like they were trying to hook you and hope you didn't want to back out after doing the paperwork. No way matey!

  20. Julz

    Or

    Perhaps this is some devious way to cut down on commuting by causing it to be uneconomic to work away from home. Thus contributing in a large part to the governments stated aim of being carbon neutral by 2050. Brilliant. Or, perhaps not...

  21. quattroprorocked

    Remote Regions? And yes, most of you really are employees

    Such as the Isle of Wight?

    I was at least expecting Thule or Afghanistan.

    As to hotels etc, the company would now expect to pay such costs directly, exactly as they do for their own employees.

    Companies should be willing to take contractors on as employees, though this transition may take a while.

    I am not a contractor, but I have run payroll and have friends who contracted going back to the 80's. I always told them that they were living on borrowed time, because the ones I knew, spending years with the same client, were clearly really employees. I'm amazed it lasted this long.

    In the Film and TV industries you can treat people as self employed or contractors for ONE PROJECT, e.g. a series, but if you get recommissioned and call them back, you are expected to class them as employees. Contractors should really push for something like that - real contractors solve a problem for a project then go and solve problems for someone else.

    1. Anonymous Coward
      Anonymous Coward

      Re: Remote Regions? And yes, most of you really are employees

      You are clueless - are you even vaguely aware of the latest Law Lords rulings on what constitutes an employer-employee relationship?

      I love you way you say your friends were clearly employees - did they have any employee benefits? Holiday? Sick pay? Pension? Paternity / Maternity / Redundancy? If they had no employee benefits and legally not treated as an employee HOW THE HELL ARE THEY EMPLOYEES?

      Honestly if you don't know the facts give it a rest as there isn't a single thing in anything you've posted that makes legal sense.

  22. R3G1
    Mushroom

    And all there lackies follow suit

    CAPGEMINI have blanketed all there staff that work for BAE so to be seen and in keeping with there customer god forbid they would have the balls to say no nada, our contractors travel 100 plus miles to work for you and you think thats ok to rob them of expenses

    was fun

  23. EmilPer.

    "will recoup £1.2bn a year by 2023" ... and lose the same amount or more when collecting other taxes

    ... payroll taxes and VAT and excise taxes and others compete over the same pool of money, you increase one the others go down

  24. IAS1&2

    Support for big business, not so much for small business.

    I rather think that the implementation of IR35 seems to punish small businesses. I might want to start a consultancy, but of course, at this time, there is only one employee...me. So I am forced to win a contract and be taxed as if I'm an employee of the client....as well as pay the usual corporation tax / VAT, professional indemnity insurance, public liability insurance, sundry business expenses...etc. How can I grow my business such that I might employ others? If I had enough money in the bank, I might be able to win the same contract on day 1, and hire three people on day two and put them to work on the contract. Thereby creating jobs as I win contracts, reinvesting the profits into company growth and employing people. The rules seem to favour the tax breaks only for large(ish), well established companies that have people sat on a bench, waiting to service new contracts. The rules don't seem to favour a one man band that might wish to one day become a larger company.

    Make no mistake, the government might support business, but only big business.

    1. Bodh_man

      Re: Support for big business, not so much for small business.

      Completely agree. It is not a level playing field. The figures published do make me laugh. If Vodafone, Amazon and Facebook, Starbucks etc... paid their fair share of corporation tax this 1.2Bn pounds of TAX revenue lost would be a drop in the ocean. There is no doubt the rules favour large corporations.

  25. Anonymous Coward
    Anonymous Coward

    Boo Hoo

    As a permenant employee, I have an internal cost far above my actual salary that factors in things like IT, equipment, desk space, heating, car parking, cleaning, building maintainace..... I don't see on-site contractors in their fake limited companies being back charged for these services/facilities, if I see less overpaid, fake contractors on ever extended contracts (10+ years in some cases) around the place then so much the better.

    1. Anonymous Coward
      Anonymous Coward

      Re: Boo Hoo

      Conversely, I quite often find myself surrounded by permies that don't have a hope of achieving what they need to be doing, don't care - or both. I'm usually there to bypass this malaise, solve whatever the problem was and (the hardest part) get the incumbents to step up and 'own it' for themselves.

      If things are delayed and I'm extended, it's likely because the staff I'm working with don't keep up or put the effort in. If they did that in the first place perhaps I wouldn't have been needed in the first place eh?

      1. Anonymous Coward
        Anonymous Coward

        Re: Boo Hoo

        ...ah yes, the super productive contractor who churns out a mountain of unmaintainable but just about working junk then bugge... moves on... leaving us permies to fix the mess....

        1. Anonymous Coward
          Anonymous Coward

          Re: Boo Hoo

          Yeah keep telling yourself that..

        2. Anonymous Coward
          Anonymous Coward

          Re: Boo Hoo

          >...ah yes, the super productive contractor who churns out a mountain of unmaintainable but just about working junk then bugge... moves on... leaving us permies to fix the mess....

          This speaks volumes about the abilities of the employees to oversee and manage contractors and their deliverables...

  26. RB_
    Meh

    It's all entertaining..

    Not everyone, but the vast majority do not understand their value. You are a contractor.. you sadly mistake yourselves for having valuable skills. You do not. No, you really don't. You are not special. Permenantly employing you is special; a commitment of the firm to the individual whose sacrifices go way beyond the daily for a contractor who is likey to have to retrain and re-kill multiple times of their employed lifetime. There are a smll percentage of contractors that are special thuogh.. and I do feel a bit bad for them. Special though - their rate demands a solution to employment, E.g., paying that rate is not a long-term ideal or fixture, so in any firm 2 years would be a long, long time. Not known a special one that didn't know this.

    IR35 is coming to end and employers and taking you on as permenants. Suddenly, you think you are not as well valued as you once where. Except, for the firm, you never where that kind of value. They have not changed what they are forking out.. just that you are getting less. You were *never* as valuable to them as your IR35 status afforded. Wise up.

    Now lots of people simply don't see that, and moan and whinge, well I don't blame them. I work for a large multi-national not quoted in the article, I will tell you that 2, just 2 people in the whole of IT are retaining their IR35. They warrant it anyway and they can readily justify it and the firm is prepared to bend-over if the tax man cometh. True value. For the rest - I repeat, you are not as valuable as you think you are.

    All these people quiting work.. well some are lucky and they can retire, more power to them. Swathes of people still need to earn to pay their bills, and swathes of work needs to be done. Hold out for a month, 3 months, 6 months if you will.. you'll be back and eating it. When the axe cuts across all industries equally, all you are doing is moaning.

    Get yourselves on the permenant gravy train and benefit from being properly valued. Earn your way their if you are good enough.

    For the vast mahjority, the complaints and posturing and moaning only.

    1. Anonymous Coward
      Anonymous Coward

      I don't have to deliver, I just need to keep my boss happy.

      Dont fool yourself - contractors are required simply because the permanent staff cannot deliver - that is the only reason. That may be due to workload, but considering the depth of technical questioning I get its because mainly due to a lack of current technical knowledge. We bring that in as a result of working around in industry.

      I look at the permies playing office politics, spending 25 - 30% of their time in meetings, ticking along at 50% and not being bothered to keep up-to-date or indulge in CPD unless they get a nice paid course somewhere. I view most permies as doing just enough. As a NATS staffer once said to me, 'I don't have to deliver, I just have to keep my boss happy'.

      Permies rely on the the Company mothership to shield them, find them work, bid for them, sort out the legals for them, chase up payment for them, pay for their holidays, do their tax and sort out their VAT. Quite a bit of backside wiping goes on for you that you're blissfully unaware of.

      Every company, and I mean every single company I've contracted for have asked me to come and join them permanently. 'We love your varied background and range of projects'. I've not yet said yes.

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