View Full Version : From Permie to contractor?

The great aardvark
23rd September 2004, 13:52

I am hoping someone can advise me. I am currently a permie trying to get a pay rise from my boss....but I was wondering also if I could get him to employ me as a contractor is there a tax advantage?

I know you used to be able to register yourself as a Ltd company, pay oneself a small salarty with big dividends, even if effectively you only had one client. However I assume the IR35 is aimed at stopping this.

Any thoughts welcomed.

23rd September 2004, 14:30
no, it's still possible but you will need an IR35-friendly contract

You will definitely earn much more, so if your boss is happy taking you in as a contractor, go for it!

23rd September 2004, 16:38
> You will definitely earn much more

Not if he gets paid at the same rate and is IR35 caught he won't.

If you want to go contracting do it but don't just convert from employee to contractor at the same place - get's us all a bad name.

Debbie Reinvented
23rd September 2004, 22:33
Has the Great Aardvark been asleep for the last few years

24th September 2004, 07:50
As he is a permie the chances are quite high.

Real contractors don't sleep on the job - they surf :)

24th September 2004, 12:27
I'm sure if your boss is willing to take you as a contract earning at least 3 times your current salary then why wouldn't he just give you a pay rise. That way you keep your job and all your benifits of being permie.

The great aardvark
28th September 2004, 13:52
The point is that if he is not willing to give me a payrise...could I effectively earn more money by paying less tax, despite being on the same salary?


Capn Graybeard
28th September 2004, 14:18

You will be 100% IR35 fodder as this was brought about specifically to counter Friday-Monday "schemes".

It might have been muddied somewhat over the years, but I doubt it's lost it's raison d'etre.


The great aardvark
29th September 2004, 12:23
Thank you Sir!

I thought this was the case but it is nice to have it confirmed.

btw am I the only one who thinks this great "upturn" is overhyped?