Self Employed to PAYE

Vegas2909

I have been self employed for the past 9 years, working solely for the same person.  He has asked if I would consider going PAYE from April.  Am I entitled to a pension contribution from him if I did this or do I have to work for a period before I am entitled to that as part of my salary?  I'm assuming that I will be entitled to holiday pay and sick pay but not sure of anything else I would be entitled to ... just want to make sure if I go down that route that I am not underselling myself and could be worse off

DE_612183

as an employee you'll have to be enrolled in a pension scheme - unless you opt out - what has your potential new employer said about pensions?

penners324

If you've been only working for 1 company for that long you should definitely be PAYE.

If HMRC decide to do an inspection there may well be a huge tax bill to be paid, probably by your employer 

Marcon

Vegas2909 said:

I have been self employed for the past 9 years, working solely for the same person.  He has asked if I would consider going PAYE from April.  Am I entitled to a pension contribution from him if I did this or do I have to work for a period before I am entitled to that as part of my salary?  I'm assuming that I will be entitled to holiday pay and sick pay but not sure of anything else I would be entitled to ... just want to make sure if I go down that route that I am not underselling myself and could be worse off

Is he offering the same rate of pay to cover all the extra costs he'll have if you change from self employed to PAYE? If so, why is he putting up his own costs...?

DullGreyGuy

DE_612183 said:

as an employee you'll have to be enrolled in a pension scheme - unless you opt out - what has your potential new employer said about pensions?

Nope, tried that, you have to be enrolled in the pension scheme if you are over 22 and earning over £10k but you can opt out of it once enrolled and then wait months for them to give back your contribution.


You will have to pay 5% into the pension, your employer 3% though some pay more. They can defer the enrolment for up to 3 months if they want. 

You'll get sick pay and holiday. 

Have you actually spoken to them on all the particulars? You'd normally expect your rate to go down when converting to a perm which reflects the additional perks of being an employee.

Vegas2909

DE_612183 said:

as an employee you'll have to be enrolled in a pension scheme - unless you opt out - what has your potential new employer said about pensions?

He hasn't said anything - just asked me if I would consider going PAYE, i put it to him about how it would work and he said he would have to speak to his accountant to find out ... he always said I would be worse off, but he will be as he will have to pay me holiday pay which currently I don't get ..

MattMattMattUK

Vegas2909 said:

DE_612183 said:

as an employee you'll have to be enrolled in a pension scheme - unless you opt out - what has your potential new employer said about pensions?

He hasn't said anything - just asked me if I would consider going PAYE, i put it to him about how it would work and he said he would have to speak to his accountant to find out ... he always said I would be worse off, but he will be as he will have to pay me holiday pay which currently I don't get ..

Marginally, you would pay more NI, but as other have pointed out your self employment is not legitimate anyway, so that will need to change.

Grumpy_chap

Vegas2909 said:

just asked me if I would consider going PAYE,.

I have periodically had end clients ask if I would consider PAYE.
I have always responded that I would not change if I were to be worse off and suggested they can table an offer for my consideration should they wish.
None of those end clients have ever actually managed to table serious offers, though a couple came close-ish:
 - In one case, the offer was with a company car and I asked for clarity on what car that meant and the questions could not be answered.
 - Another, I asked for clarity on the pension contributions and maximum SS but never received an answer.

For the OP, has the employer undertaken an assessment with regard to inside- or outside-IR35?  (SDS = Status Determination Statement)
As others have mentioned, only working for one employer over a long period of several years is an indicator of deemed employment (inside IR35) but there is generally no single factor alone that can fully determine status.

EnPointe

Marcon said:

Vegas2909 said:

I have been self employed for the past 9 years, working solely for the same person.  He has asked if I would consider going PAYE from April.  Am I entitled to a pension contribution from him if I did this or do I have to work for a period before I am entitled to that as part of my salary?  I'm assuming that I will be entitled to holiday pay and sick pay but not sure of anything else I would be entitled to ... just want to make sure if I go down that route that I am not underselling myself and could be worse off

Is he offering the same rate of pay to cover all the extra costs he'll have if you change from self employed to PAYE? If so, why is he putting up his own costs...?

because  he probably realises he  runs a very good risk of  gettign done over  by HMRC for the sham self employment of the OP forthe past 9 years 

 bne very hard for the OP to demonstrate  that  they are actually self employed if they have worked  solely  ( or even mainly) for one 'client' the entire time 

Marcon

EnPointe said:

Marcon said:

Vegas2909 said:

I have been self employed for the past 9 years, working solely for the same person.  He has asked if I would consider going PAYE from April.  Am I entitled to a pension contribution from him if I did this or do I have to work for a period before I am entitled to that as part of my salary?  I'm assuming that I will be entitled to holiday pay and sick pay but not sure of anything else I would be entitled to ... just want to make sure if I go down that route that I am not underselling myself and could be worse off

Is he offering the same rate of pay to cover all the extra costs he'll have if you change from self employed to PAYE? If so, why is he putting up his own costs...?

because  he probably realises he  runs a very good risk of  gettign done over  by HMRC for the sham self employment of the OP forthe past 9 years 

 bne very hard for the OP to demonstrate  that  they are actually self employed if they have worked  solely  ( or even mainly) for one 'client' the entire time 

Putting OP on PAYE now is more likely to highlight the issue than conceal it - and without knowing anything at all about their terms of engagement it's impossible to know (although I too had the same thought as you!). Hence my suggestion that OP needs to understand why this is being proposed...

Vegas2909 said:

DE_612183 said:

as an employee you'll have to be enrolled in a pension scheme - unless you opt out - what has your potential new employer said about pensions?

He hasn't said anything - just asked me if I would consider going PAYE, i put it to him about how it would work and he said he would have to speak to his accountant to find out ... he always said I would be worse off, but he will be as he will have to pay me holiday pay which currently I don't get ..

Depends on the terms on which you become an employee - IF you become one. With 9 years of somewhat dubious self employment, you should be in a good negotiating position.