Employment contract red flag?

Sandtree

lloyde92 said:

Sandtree said:

lloyde92 said:
Theres also no info about holiday/sick policy and they require me to pay my own tax on my salary.

Then you arent going to be an employee

Yeah. It basically sounds like an ongoing contractor role (not quite what I thought). Will need to ask them a bunch of questions before I sign. Thanks for your input 

As a long term contractor I personally don’t have an issue with not being an employee but monies have to reflect the lack of benefits and the risk. 

My day rate has always been about 1/100th of what I’d expect my salary to be. As long as I can keep in work most the year then it’s easy to earn way more than as a perm. 

The concern here is that it’s been done underhand by the sounds of it which would mean the monies are not marked up that much. 

A lot to talk about! 

TELLIT01

I've never been self-employed, but hasn't HMRC tightened up on whether a person should be classed as s/e or an employee/worker?

Sandtree

TELLIT01 said:

I've never been self-employed, but hasn't HMRC tightened up on whether a person should be classed as s/e or an employee/worker?

Not exactly, I assume you are talking about the changes to the IR35 legislation that came into effect this year for the private sector?

IR35 has always said that if you look like an employee and smell like an employee then you should pay the tax and NI of an employee irrespective of what contracts may say or what legal structures you've put in place to avoid it. The changes havent adjusted that and so technically doesnt directly tighten the rules however what it does say is that now the client is liable for any underpayment of tax/NI if the person is operating as self employed or via a PSC LTD rather than the contractor themselves.

 mr/ms/mx one person band has often been comfortable saying they are outside IR35 and HMRC never had the resources to chase each individual for their potential £5,000 of under payment. Your RBS/PWC/Tesco's however are much more risk adverse and they have hundreds or thousands of contractors and so its worth going after a big company where you get 200x£5,000 if you find their determination is wrong rather than having to go after 200 people for £5,000 each.

So a lot of companies offering contracting roles have either switched to FTC instead or are saying you must go through an appropriate umbrella company who'll take your day rate, take off employer costs and pay the rest as salary through PAYE and so you are paying all employee taxes/ni and so no risk to the client.

HMRC have provided a tool (CREST) to help companies determine if someone is inside or outside and their are third party tools and insurance available too. As a rule of thumb if you are doing a business as usual role or if you have line management role etc you will be inside. If you are doing a one off discrete piece of work, can set your own ways of working (within industry standards/normal practices etc) and work where/when you like then you can get an outside determination. 

jobbingmusician

OP, are you allowed to subcontract your work, or do you have to perform it yourself?

Is this the only employer you work for?

It does sound to me as if they *SHOULD* be employing you.  What is this 1 page document headed, if anything?

Marcon

lloyde92 said:

Sandtree said:

lloyde92 said:
Theres also no info about holiday/sick policy and they require me to pay my own tax on my salary.

Then you arent going to be an employee

Yeah. It basically sounds like an ongoing contractor role (not quite what I thought). Will need to ask them a bunch of questions before I sign. Thanks for your input 

If this is a 'full time permanent job', the chances of HMRC agreeing you are self employed are pretty slim. Worth checking before you go any further: https://www.gov.uk/guidance/check-employment-status-for-tax