2 offers: Accepted Lower Rate Public Sector (out ir35) vs Higher Rate Private Sector

[Kotelki]

Hi all!

I have 2 offers on the table at the moment:

1) Public Sector Outside IR35 - Initially I said yes verbally. contract not signed yet, waiting to be signed. Documents provided.
Rate: 300

This would be my first contract in public sector - is there any risk even if it's confirmed by client that it's outside ir35? I also had contract ir35 reviewed and it's outside.

2) Private Sector Outside IR35 - I didn't expect this one. I've just received offer, so nothing signed yet and no documents provided. I am waiting for them to send the contract to have a look at it.
Rate: 500

Distance from home and Length are the same in both offers.

Which one would you choose?

[Hobosapien]

Depends. Consider the following to help you decide.

1. How much is the rate difference and which would you prefer if all else was equal?

2. What is the initial and likely length of both? If private sector one is most likely a short contract of a few months without much chance of an extension then very unlikely HMRC will bother to investigate a short outside IR35 contract.

3. Use the higher rate offer to see if there's room to negotiate a rate increase on the lower rate offer. Even though you've verbally accepted the lower offer tell them a better offer has come about and can they match it.

4. Get the private one reviewed for IR35 and see how much the insurance cover would be. If it works out cheaper than going with the lower rate then worth pursuing.

5. Are you contracting via a Ltd or brolly? If the latter then IR35 doesn't figure so can base the decision on merits of each contract rather than fear of the HMRC bogeyman.

[Kotelki]

Hobosapien thank you for your reply,

Rate difference is 300 vs 500.

Both 3 months with possible extension.

Contracting via Ltd.

The one with public sector has 1 worrying thing - warranty period after termination.

The one with private sector requires Background checks - so that will take a few more days to do.

[gables]

Hi all!

I have 2 offers on the table at the moment:

1) Public Sector Outside IR35 - Initially I said yes verbally. contract not signed yet, waiting to be signed. Documents provided.
Rate: 300

This would be my first contract in public sector - is there any risk even if it's confirmed by client that it's outside ir35? I also had contract ir35 reviewed and it's outside.

2) Private Sector Outside IR35 - I didn't expect this one. I've just received offer, so nothing signed yet and no documents provided. I am waiting for them to send the contract to have a look at it.
Rate: 500

Distance from home and Length are the same in both offers.

Which one would you choose?

Hobo makes a good point re brolly\ltd as you don't say how you operate, but even with that it's quite a rate difference. For me it would come down to the role details, and the lower rate one (being public sector wouldn't be an issue for me) would have to be really attractive in terms of tech or the opportunity to get involved in something new to justify it over the higher rate role.

[northernladuk]

You've listed nothing but he rate which has an obvious massive gap. How is there is a decision to make there?

You feeling a bit proud of yourself and just wanted to blow your own trumpet or something?

From that info take the high one.

[MrButton]

Take the high one. Unless it sounds really really really crap

[Hobosapien]

I'm sure there were fewer details (such as rate) in the OP when I first replied, unless my reading skills are patchy.

The rate difference means you could take the private one and operate as inside IR35 and still be better off than taking the public one.

The public one is safe as they are liable for determining whether inside or outside, though check the contract from the agency in case they have tried to offload any liabilities if the client is proven to have deemed incorrectly by HMRC. The agency as fee payer would be on the hook as things stand and not sure how a contract trying to offload that responsibility would actually stand up in court, but easier to not have to go down that road if can be avoided.

Get the private one reviewed to see where you would stand in terms of IR35 complications.

Potential contract length of either still factors if the private one is likely to be very short, which usually depends on the type of role you are doing for the client as to how long they may need you for whatever service you will be providing.

[sal]

At such a massive difference in the rate, this is not a hard choice.

If you like the Public sector role that much you can try and squeeze some more dough from the Agency/ClientCo by saying you have a better offer on the table.

Personally I wouldn't consider going for £200 less no matter the roles specifics. Cash is king.

[northernladuk]

At such a massive difference in the rate, this is not a hard choice.

If you like the Public sector role that much you can try and squeeze some more dough from the Agency/ClientCo by saying you have a better offer on the table.

Personally I wouldn't consider going for £200 less no matter the roles specifics. Cash is king.

Due to the frameworks public sectors use its highly unlikely they will move. They will have approved rate cards and thats it. Quite different to some private sectors where you can negotiate.

[sal]

Due to the frameworks public sectors use its highly unlikely they will move. They will have approved rate cards and thats it. Quite different to some private sectors where you can negotiate.

There is public sector and then there is public sector. I have worked on 4 public sector contracts for only one of them the rate was "fixed" and the agency fee was fixed so there was no room for "manoeuvring". On one of them the agency was skimming 30%+ and was easy enough to squeeze them. On the other 2 the PMs had some discretion with their budget and could "play" with the rates to some extend for the "right person".

Doesn't hurt to ask in this case, where there is "guaranteed" fallback.