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Am I worrying too much?

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    Am I worrying too much?

    I have been contracting for nearly three years now, with a single client. (For reference, they are considered a *small* company). Sorry this might be a bit lengthy but I'm really confused with what to do on a time-sensitive situation!

    ---

    I was originally brought on to build a small BI tool, and when that initial 3 months was finished, they wanted me to takeover one of their projects as they were moving internal resources onto "the next big thing".

    They needed to scale an existing website and move it onto cloud architecture e.t.c. - and at some point during this I told them I am planning to work remotely, and start building my brand a bit more - to which they obliged and said it's fine if I want to work remotely, so long as I touch base now and then. This is all on my own equipment too.

    I have now finished this specific project (around 2.5 years on top of the initial 3 months for the other thing) , and surprise surprise - they like the skillset I bring (and obviously the quality of my work) and have asked if I will now provide consultancy services for the next year over-seeing their "next big thing" and making sure the team are doing it "right", and helping scale the system out by making architectural improvements.

    ---

    I am fairly certain I am outside IR35 - my contract definitely is (had it reviewed), and I am waiting on QDOS to check my working practices. But I feel really nervous about the fact they want me to do one more year with them, which would take me up to 4 years in.

    From the client's perspective - he has said many times "but I don't understand, if I like the services you provide then obviously I'm going to want to give you more work" - it's not like he's obliged to, he genuinely just wants to keep me around because of the specialist knowledge I (or I suppose, my company) provide(s).

    I originally was waiting to deliver this project and move on - but the market is completely dead at the moment, and I have moved from London to the West Midlands so it's even more dire!

    I don't want to get caught inside or have to pay a load of fees to HMRC, it would basically mean the last three years (or four if I stay) were sort of pointless as I could have just been perm, with benefits, working my way up a corporate ladder.

    ---

    So I am at a crossroads. A local company in the Midlands has extended me an offer for a perm role - working at one of the "best" companies in the area (the pay is sort of competitive for the area but not like super high, just under 70k - but maybe 25k a year post tax less), where I would learn a *LOT* and work with all the latest toys. But the idea of having to request holidays, do as your told in every way, try and work your way up and not be able to work when and where I want is really really really putting me off! (Although I concede working another contract would maybe lose me a lot of the current freedom I have))

    On top of that, I have my first child on the way and I would love to spend time at home with the missus and baby to help ease into our new life, whilst taking home some good cash!

    MY current client *really* want me to stay, but I've said to them, I don't know if its worth the risk...

    ---

    To finish, I have some questions, folks at CUK (I am a long-term lurker, FYI).

    - Am I worrying too much? If I get my working practices checked and I'm outside IR35 - do I have the golden ticket ATM (small company, deemed outside, a years worth of project work scoped out)???

    - Should I just go INSIDE IR35 to remove my fears? Re-write the contract completely so its a new job role (which is kinda is, since its more consulting from an architecture perspective than raw coding).

    (Although this may be some admission of guilt, which would screw me over if I had to go back and pay - and this is why IR35 sucks, I don't THINK I'm outside, but I'd go inside if possible just so I didnt have to worry about some bulltulip investigation that could screw over my family).

    - Would an umbrella be a good move? I'm not really sure why people are talking about Umbrellas, I fail to see how they actually help the situation since you still need to decide if you're IN or OUT? and if you are IN isn't it better to just ... be a PSC but declare yourself INSIDE?

    - Should I take the perm job, put in the graft for a year, earn a lot less money, not be at home with my wife and newborn kid, but ride out this storm and see what the contract market is saying in 12-18 months? If its good, I have all this extra experience that should make finding a new gig simple, if it sucks, im 12-18 months into a good perm position and probably due a promotion.


    Sorry - I do tend to ramble on a bit but this is keeping me up at night! And again, due to the offer on the table, it's a pretty time-sensitive issue!

    Thank you all

    #2
    It's a no-brainer - take the local permie job and sit out the storm for a year or two.

    You can't afford the gamble with a kid on the way.

    (And I'm sorry to say this but your working practices point to you being well inside IR35 if HMRC come knocking...)
    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
    - Voltaire/Benjamin Franklin/Anne Frank...

    Comment


      #3
      Originally posted by cojak View Post
      It's a no-brainer - take the local permie job and sit out the storm for a year or two.

      You can't afford the gamble with a kid on the way.

      (And I'm sorry to say this but your working practices point to you being well inside IR35 if HMRC come knocking...)
      I disagree.

      The key is whether this small client is genuinely a small business, i.e. meeting two of the following:
      1/ an annual turnover of less than £10.2 million
      2/ a balance sheet total of less than £5.1 million
      3/ fewer than 50 employees

      If that's the case, self-determination still applies. With working practices and contract firmly outside IR35, I'd chat to the client hiring manager and explain about the new IR35 laws. Explain that nothing can happen to them if they are small (see above) and that you need him to confirm the working practices are valid if HMRC come knocking. You're well down the list for an investigation imho with big lists of low-hanging fruit about to be generated in April.
      The greatest trick the devil ever pulled was convincing the world that he didn't exist

      Comment


        #4
        Originally posted by cojak View Post
        It's a no-brainer - take the local permie job and sit out the storm for a year or two.

        You can't afford the gamble with a kid on the way.

        (And I'm sorry to say this but your working practices point to you being well inside IR35 if HMRC come knocking...)
        I do have a strong warchest - I would obviously like to keep earning and not tap into it but I live with my Dad and we don't have a mortgage to pay. But whilst one of the huge factors in "should I stay or should I go" is the 2k a month that doesn't get put towards little Timmy, equally the *time* with the kid (and wife) is really important to me.

        I'm half thinking to myself, in 5 years time would I kick myself for not having been around for the first 6 months of my childs life when most people aren't fortunate enough to do that? But again, I don't want to put the family at risk especially if I am not playing fairly.



        RE: working practices - but what if QDOS say its all good? I have MOO (I know the extensions might blur that a bit but there have been numerous times I have refused to do certain tasks). Control wise, all the permies *have* to work on-site, for the core hours, whereas I work remotely, and do whatever hours I want (as long as I'm generally contactable). I also use my own equipment, everyone knows I'm a contractor, I avoid normal staff meetings e.t.c. I have also once hired help for a summer to assist me deliver some tasks, although I do wish I did that a little more just to have "more to prove".

        I know this sounds a bit cheeky, but if I have IR35 insurance from say QDOS, then doesn't that sort of eliminate all risk on my end?

        Argh, I hate IR35. I 100% understand why it exists and have met many cheeky contractors but it's seriously shafted my life plans lol.

        Are we really all thinking contracting is gone? I mean I would honestly still consider taking inside IR35 gigs because they would still pay more than a permie role and give me a lot of flexibility / shifting around. Money is obviously a big part of going contracting, but I do like the freedom and difference in relationship.

        Comment


          #5
          Your options are:-

          1) Stay where you are - try to be outside but I really don't think you are after 3 years there..
          2) Go perm locally, with a child on the way I would be head in that direction, ride things out and try to move up a level...
          merely at clientco for the entertainment

          Comment


            #6
            Well, it sounds as if you’ve tossed your coin and found your answer.
            "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
            - Voltaire/Benjamin Franklin/Anne Frank...

            Comment


              #7
              Must admit, although I get what LondonMac says, I think I am with Cojak on this one. Despite having very flexible working conditions 3 years at a company of this size just smacks of permie. The line between a project and business as usual/part and parcel is very tight and from the explanation and what the client manager said to him sounds like a step too far in to part and parcel to me.

              Although time isn't directly a factor in IR35 it gets harder and harder to stay outside, particularly in an organisation that just sees you as part of the company, which they must do after 3 years.

              The fact both poster and client manager is talking about the person delivering I'd be very surprised if they would allow RoS as well.

              I'd also be err'ing on the side of caution here to start off with. Self determining outside isn't a golden bullet. It's what we do now so at risk of an investigation as we are now, so the risk hasn't gone away.

              Remember as well... The small company exemption is likely the next thing to go when the dust settles.

              All that, and a peach of a permie role landing in his lap just tips it for me. Just treat it like a poorly paid gig which we all get once in awhile. Do a year and come back to market with a refreshed skillset and start again.

              But the idea of having to request holidays, do as your told in every way, try and work your way up and not be able to work when and where I want is really really really putting me off!
              That's what 99% of the rest of the population manage to do so I'd put that right to the very back of your problems. Do they not have a WFH option? You would be very unlucky if they didn;t.
              You have a very cushy gig but you are a contractor and they end. It's what we do. Got to get over that bit.
              'CUK forum personality of 2011 - Winner - Yes really!!!!

              Comment


                #8
                You worry too much. Keep contracting. Stay outside of IR35.

                Comment


                  #9
                  My suggestion would be to go for the middle ground.
                  - Keep the customer.
                  - Look to find other customers.
                  - LEARN about IR35 yourself and understand it.
                  - be a business.
                  - understand all the risks and mitigate them

                  you say you'd be willing to be inside so just save the money and if HMRC come knocking just cough up rather than fight... well fight a little bit... but you get the idea

                  IR35 isn't supposed to stop people running genuine businesses. So be one.
                  Sounds like you have a good opportunity to do so.
                  Last edited by Lance; 9 March 2020, 19:56.
                  See You Next Tuesday

                  Comment


                    #10
                    Originally posted by Lance View Post
                    My suggestion would be to go for the middle ground.
                    - Keep the customer.
                    - Look to find other customers.
                    - LEARN about IR35 yourself and understand it.
                    - be a business.
                    - understand all the risks and mitigate them

                    you say you'd be willing to be inside so just save the money and if HMRC come knocking just cough up rather than fight... well fight a little bit... but you get the idea

                    IR35 isn't supposed to stop people running genuine businesses. So be one.
                    Sounds like you have a good opportunity to do so.
                    I would like to think I understand IR35 fairly well - I've been aware of it and a fair amount of its in's and out's since before I made the plunge into self-employment.

                    I do genuinely want to build my business and build a brand - ranging from whitelabel solutions, selling educational content, and of course doing contract work.

                    I have worked really well with my client for a while, and I would like to think my company has proven its worth and there is potential to keep freelance work going, and perhaps maintain a long-term relationship with them even if not via a single contract for a large portion of the working week.

                    I don't want to be inside really - but I am just saying these regulations are so ambiguous that I'd rather get a rubber stamp from HMRC to not come after me just to take away the stress! I get what you mean about saving the money just in case...but they can come for that over the next 20 years - whose to say HMRC don't build an amazing AI that screws us all over with lightning speed!

                    Also - the backdated tax would screw me over because I don't have much of that left, nor would I like to be stung by any fees - again especially when I believe I am doing things right!

                    But are you thinking I am OK to stay where I am (provided I get QDOS to give me an all-clear)? Also *does* the insurance keep my back covered or is that a foolish solution to "mitigate my risks".

                    Comment

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