Permanent Equivalent Salary Permanent Equivalent Salary
Page 1 of 3 123 LastLast
Posts 1 to 10 of 23
  1. #1

    Nervous Newbie

    grumpyjr has no reputation


    Join Date
    Sep 2016
    Posts
    5

    Default Permanent Equivalent Salary

    Hi All,

    First post so please go easy on me NorthenLad I promise I have read all the guides and been a long time lurker.

    I am in a contract at the moment and have been offered a fairly decent Permie package. I just wanted to see what the thoughts are on an equivalent salary to £500 per day working 220 days a year? I have read a few posts on here but they seem to be quite old and so I was just wondering what the current thinking is based on the changes to Dividend tax etc etc.

    Some experienced contractors I've spoken to have suggested deducting around 30% from turnover to get a "take home" figure. Just wondering what the general consensus was as the package offered equates to around 90k so take home of about 58k.

  2. #2

    Super poster

    Whorty - scorchio!

    Whorty's Avatar
    Join Date
    Dec 2014
    Location
    South West
    Posts
    4,343

    Default

    There are various calculators on the web that can give you an idea. At 500 per day, inside IR35 it will be a perm salary of about 90k, outside IR35 something like 114k. These will package values so included in these will be pension, bonus, BUPA etc that you might get as a benefit.

    Very few companies will pay a contractor a salary that is anywhere near their day rate equivalent.

    In my line of work, my day rate is 550-600 yet a perm salary would be 60k plus benefits (so total package around 70k). Well short of my day rate, but then I'd get this every month and have no time on the bench which is what the extra day rate cash pays for

    And who doesn't like bench time ... catch up on the gardening, Tour de France, long holiday
    I am what I drink, and I'm a bitter man

  3. #3

    More fingers than teeth

    greenlake has reached the peak. Play again?

    greenlake's Avatar
    Join Date
    Sep 2013
    Posts
    13,599

    Default

    Quote Originally Posted by grumpyjr View Post
    I am in a contract at the moment and have been offered a fairly decent Permie package.

  4. #4

    Double Godlike!

    malvolio - scorchio!

    malvolio's Avatar
    Join Date
    Jul 2005
    Location
    Walking in the garden, dreaming of Olivia...
    Posts
    11,927

    Default

    £500 a day is £62.50 an hour is roughly £62,500 to get the same net takehome. Thats very roughly...
    Blog? What blog...?

  5. #5

    I live on CUK

    SueEllen is always on top

    SueEllen's Avatar
    Join Date
    Nov 2005
    Location
    in the Park
    Posts
    29,702

    Default

    Quote Originally Posted by Whorty View Post
    There are various calculators on the web that can give you an idea. At 500 per day, inside IR35 it will be a perm salary of about 90k, outside IR35 something like 114k. These will package values so included in these will be pension, bonus, BUPA etc that you might get as a benefit.
    I actually had a company interview me for a role with a salary around the £110K mark. The interviewer sounded suicidal so I chose not to progress onto the next step.

    I personally find it amusing that when some permies interview you they don't realise that if they sound miserable then unless you are desperate you aren't going to take the role.
    "You’re just a bad memory who doesn’t know when to go away" JR

  6. #6

    Should post faster

    blackeye is too good to be a permie


    Join Date
    Jul 2016
    Posts
    175

    Default

    Quote Originally Posted by malvolio View Post
    £500 a day is £62.50 an hour is roughly £62,500 to get the same net takehome. Thats very roughly...
    How?

  7. #7

    Godlike

    jamesbrown is a fount of knowledge

    jamesbrown's Avatar
    Join Date
    Dec 2011
    Posts
    8,751

    Default

    Quote Originally Posted by blackeye View Post
    How?
    Well, I think you can deduce the rule of thumb being applied. It's pretty useless though. They all are. Apples meet pears. You can't use a contractor's day rate as a bargaining chip or yardstick for a permie salary. The best way to benchmark a permie salary is to look at the permie market, not extrapolate from a contract rate.

  8. #8

    Double Godlike!

    MrMarkyMark is a fount of knowledge


    Join Date
    Dec 2012
    Posts
    11,412

    Default

    Quote Originally Posted by jamesbrown View Post
    Well, I think you can deduce the rule of thumb being applied. It's pretty useless though. They all are. Apples meet pears. You can't use a contractor's day rate as a bargaining chip or yardstick for a permie salary. The best way to benchmark a permie salary is to look at the permie market, not extrapolate from a contract rate.
    In IB, I have seen a guy jump straight from contractor to Director, just recently. The guy would have been on a good day rate, others on not much more may only make VP, or at worse AVP.
    Obviously, you need to "sponsored" by senior management so sometimes there is much more to it, than purely day rate.

  9. #9

    Should post faster

    blackeye is too good to be a permie


    Join Date
    Jul 2016
    Posts
    175

    Default

    Quote Originally Posted by jamesbrown View Post
    Well, I think you can deduce the rule of thumb being applied. It's pretty useless though. They all are. Apples meet pears. You can't use a contractor's day rate as a bargaining chip or yardstick for a permie salary. The best way to benchmark a permie salary is to look at the permie market, not extrapolate from a contract rate.
    Agreed.

    I certainly don't think £500/d = £62k perm, even with great benefits. Unless you start putting value on the intangible benefits such as development etc.

  10. #10

    Banned

    Fronttoback 's job has never been outsourced


    Join Date
    Sep 2016
    Posts
    446

    Default

    Quote Originally Posted by MrMarkyMark View Post
    In IB, I have seen a guy jump straight from contractor to Director, just recently. The guy would have been on a good day rate, others on not much more may only make VP, or at worse AVP.
    Obviously, you need to "sponsored" by senior management so sometimes there is much more to it, than purely day rate.
    I have seen this too. If you are useful and on a good day rate and they want you to go perm, if your contract market is good you can leverage that to get a senior perm role. Depends on market conditions at the time you approach this transition. But in principal I've seen several (non-management) contractors cross over into senior perm management roles. Obviously you have to be polished to pull this off. Not a boiler room techie who's never had a shave.

    And I'm talking about 200k/Yr plus bonus IB perm roles, fr 750/day sterling gigs.

Posting Permissions

  • You may not post new threads
  • You may not post replies
  • You may not post attachments
  • You may not edit your posts
  •