Will contracting go out with a bang or a whimper?

[BlasterBates]

IR35 Mk II means it's up to the client to determine whether contractors are inside or outside IR35.

It seems highly unlikely that a client will comfortable with an army of contractors outside IR35, because potentially it'll cost them a lot of money.

Probably there will be at most a handful of contractors outside IR35 at each client.

i.e. this is the death of mass outside IR35 contracting, but not the death of contracting.

This is what happened in Switzerland a few years ago, seems like a very similar approach.

[cojak]

IR35 Mk II means it's up to the client to determine whether contractors are inside or outside IR35.

It seems highly unlikely that a client will comfortable with an army of contractors outside IR35, because potentially it'll cost them a lot of money.

Probably there will be at most a handful of contractors outside IR35 at each client.

i.e. this is the death of mass outside IR35 contracting, but not the death of contracting.

This is what happened in Switzerland a few years ago, seems like a very similar approach.

Bizarrely, this is the most reassuring post I've come across.

[pjt]

IR35 Mk II means it's up to the client to determine whether contractors are inside or outside IR35.

It seems highly unlikely that a client will comfortable with an army of contractors outside IR35, because potentially it'll cost them a lot of money.

Probably there will be at most a handful of contractors outside IR35 at each client.

i.e. this is the death of mass outside IR35 contracting, but not the death of contracting.

This is what happened in Switzerland a few years ago, seems like a very similar approach.

How did this affect the contracting market in Switzerland do you know?
I do think contracting will continue it just wont be as lucrative.

[Pherlopolus]

The contracts I have seen and been approached about have been fairly high rate, even taking into account the forced umbrella and normal payroll factors.

I think it would be a fair split if the BAU contracts were classed as Inside, and the specific project/programme roles with a specific programme duration (even if that was multiyear) contracts were outside. Fairly sure this is too simple though.

[pjt]

The contracts I have seen and been approached about have been fairly high rate, even taking into account the forced umbrella and normal payroll factors.

I think it would be a fair split if the BAU contracts were classed as Inside, and the specific project/programme roles with a specific programme duration (even if that was multiyear) contracts were outside. Fairly sure this is too simple though.

Fingers crossed then if this all comes in the rates go the same way here
We can only hope!

[BlasterBates]

How did this affect the contracting market in Switzerland do you know?
I do think contracting will continue it just wont be as lucrative.

Exactly. A lot of UK contractors were in any case temporary employees, but after a lot of wailing and gnashing of teeth the Swiss contractors running their own companies switched to temp contracts. Didn't really affect the market as such just a bit more grumpiness. Everyone had to take their "20 days holiday", which was deducted from the rate and then paid out when you took "holiday".

[DonkeyRhubarb]

You could always join a 90% scheme.

Sorry, I'll get my coat.

[Gaz_M]

Has anybody had any direct corresponsance from their accountants yet?

It's all very well people saying that 'contractors have got their heads in the sand' but surely we need to hear something concrete & not just predict the end is nigh.

I'm with SJD & have heard nothing at all from them. I'd hope they'd be on the ball as much as anybody else.

[jamesbrown]

Exactly. A lot of UK contractors were in any case temporary employees, but after a lot of wailing and gnashing of teeth the Swiss contractors running their own companies switched to temp contracts. Didn't really affect the market as such just a bit more grumpiness. Everyone had to take their "20 days holiday", which was deducted from the rate and then paid out when you took "holiday".

I thought employment taxes in Switzerland were much lower overall (esp. higher rates) and taxation of dividends much higher relative to the UK(?) Unless there's a material difference in tax positions, you're unlikely to get people incorporating primarily for tax purposes. Other points of comparison are Canada and Oz in that they both introduced strict deeming criteria to discourage incorporation for tax purposes (due to a large tax gap)...

[LisaContractorUmbrella]

Has anybody had any direct corresponsance from their accountants yet?

It's all very well people saying that 'contractors have got their heads in the sand' but surely we need to hear something concrete & not just predict the end is nigh.

I'm with SJD & have heard nothing at all from them. I'd hope they'd be on the ball as much as anybody else.

There isn't anything concrete for anyone to get their head around - son of IR35 is currently under discussion at HMRC and, although the consultation on T&S is finished we won't know anything for certain until the Autumn statement on 25th November