Many people getting offered higher day rate to work Inside IR35

[Frogeye]

I've just heard from a well-known agency who are offering a stack more ££ day rate (they mentioned up to 50% more) if you're happy to work inside IR35 at MOD....

Is this common? I don't know whether to believe it but has anyone else had this kind of offer? If so it must be hurting MOD/other gov units... and presumably forcing more roles out to the big Cos when they're not filled by indi contractors?

[ladymuck]

Yes it's been bandied about quite a lot in some areas. I know Imperial College were offering a rate uplift because they decided all contractors were inside.

[northernladuk]

I wouldn't believe a word an agent tells me for a start. That said, some places are offering an uplift, some aren't. Take each on its own merits and decide if you want the gig or not. The past is the past so consider the rate offered and make your decision.

I find the 50% figure a bit unbelievable but there could be other factors in play.

[Hobosapien]

Yes just consider the rate on offer compared to other opportunities. 50% uplift of a crap rate may still be a crap rate.

It is true that some PS clients realise they need to offset the impact of IR35 to attract decent contractors, who may otherwise be avoiding the whole mess best they can by avoiding PS, where being outside IR35 is a tad easier to get sorted during the contract negotiation phase. Especially where blanket inside IR35 determinations are being mishandled by PS.

[Concorde]

Many people getting offered higher day rate to work Inside IR35

I've just spoken to someone who's getting £50 per day more - 10% uplift? Not massive but this gov dept is cash strapped and has 65% freelance workforce in some areas. The nuts? A an unlawful blanket IR35 policy is creating a spectacular own goal!

[Hobosapien]

If it means the HMRC reported tax figures are up they don't really care how they arrived there.

So like how silly house prices are just people paying each other a larger amount that cancels out to some degree, same for PS rate increases where the tax received gets fed back into the system to cover the cost.

Everything is the same except the numbers look bigger.

[youngguy]

I've certainly seen PS roles fairly consistently higher - 10 to 15% , in the last few months so it does appear that rates are climbing up a bit.....but I haven't seen anything like 50%

[Maslins]

If it means the HMRC reported tax figures are up they don't really care how they arrived there.

Yup. Hammond can take the glory for increased tax take, and when each PS dept spends more, he can give them grief for poor efficiency. So he/govt look ace, whilst giving further evidence of the need for more punitive cuts to PS.

In terms of what we've seen, of our PS clients, most have seemingly been treated as inside IR35 but also given circa 20% day rate hikes to compensate. Not as much as 50% tho.

[eek]

Yup. Hammond can take the glory for increased tax take, and when each PS dept spends more, he can give them grief for poor efficiency. So he/govt look ace, whilst giving further evidence of the need for more punitive cuts to PS.

In terms of what we've seen, of our PS clients, most have seemingly been treated as inside IR35 but also given circa 20% day rate hikes to compensate. Not as much as 50% tho.

so enough for local people to roughly break even and continue in contract but not enough for those who live further away to stay....

[psychocandy]

Yep me.

Current client - LOT of contractors left beginning of the year when client decided they were going to be inside IR35 and no rate rise was offered. Also, I imagine the risk of retrospective action would have been an issue.

After a month or two, client thought feck what are we going to do. 35% increase to rates was offered to all new contractors. Which included me when I started in April. Yes its hassle to go umbrella but my take home is pretty much the same as before.

Local gig for me as well. Not sure if its going to be attractive to people who used to stay over/travel a long way - after all no expenses claim any more. Probably good news for local candidates like me where its not an issue (12 miles for me).

Bottom line

Client is 35% worse off.
Client now potentially has less contractors to choose from (i.e. only worth it for local people)

Agency is better off. They've now got an extra 35% to take a cut of.

I'm financially about the same. Just a bit of hassle with having to use umbrella.
I know client is struggling to get people so chance of long gig looks very good (they asked me if I "minded" going through SC within a week of me being here).
My pension is now doing well. Worked out (if you can get an umbrella to do it as salary sacrifice) that for every £200 I pay into pension would be less than £100 in my pocket.

HMRC/government now collecting shedloads of extra tax (of course paid for by client). Out of one government pocket and into another with a bit of fannying about in the middle.

Pointless? Totally.