Using online calculators, numbers for a typical £50/hr contract compared with employee with similar cost to the endClient:
1. Employee: cost to the endClient: £82500, takehome: £56385, tax: 31.6%
2. Outside IR35: cost to the endClient: £82500, takehome: £58080, tax: 29.6%
3. Inside IR35: cost to the endClient: £82500, takehome: £47512, tax: 42.4%
>> What is being fair in >42% tax?
Can't see the govt asking the endClient to incur 26% additional cost to fund its tax grab. At the most the govt could have asked for a 'levy' 2% on contractor companies (bridging the gap between 1 & 2)- to address the 'political cry to be fair').
With regards to PSCs being able to 'build-up' cash (lucky ones), employees could do the same via pension (again lucky ones).
1. Employee: cost to the endClient: £82500, takehome: £56385, tax: 31.6%
2. Outside IR35: cost to the endClient: £82500, takehome: £58080, tax: 29.6%
3. Inside IR35: cost to the endClient: £82500, takehome: £47512, tax: 42.4%
>> What is being fair in >42% tax?
Can't see the govt asking the endClient to incur 26% additional cost to fund its tax grab. At the most the govt could have asked for a 'levy' 2% on contractor companies (bridging the gap between 1 & 2)- to address the 'political cry to be fair').
With regards to PSCs being able to 'build-up' cash (lucky ones), employees could do the same via pension (again lucky ones).
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