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  #41  
Old 13.09.2013, 13:37
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Re: S/W Engineer: Contractor vs Permanent salary

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Aw, boo hoo. Because a 600 day rate with 5% tax paid down isn't adequate enough compensation for those incredibly unlikely scenarios. Seriously, you're only looking at one side of the scale there and well-paid IT mercenaries are in no way victims of the system.
600 day rate with 5% tax paid is a fairy tale. You seem to have a lot of anger against the "well-paid IT mercenaries" (?!).

Some are victims of the system. Contractors observing IR35 legislation pay the maximum amount of tax possible in the UK, and they have no benefit for the double NI whammy, unlike employees, who get paid sick days, paid maternity leave, paid holidays, redundancy, entirely onerous job security etc.
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  #42  
Old 13.09.2013, 13:40
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Re: S/W Engineer: Contractor vs Permanent salary

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Because the company did not want an employee. They wanted someone who could be dropped the moment there was no work. They wanted someone who could be drip fed with 1-3 month contracts and sometimes told to take a month or two off, when the workload was low. They wanted someone who required no training. If they had taken on an employee, that employee would be still on the payroll, long after the project ended.
In that case there's no unfairness involved. The contractor in question must have agreed to these terms, right?
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  #43  
Old 13.09.2013, 14:08
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Re: S/W Engineer: Contractor vs Permanent salary

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I'm not disputing any of this. I merely said that the "IR35 safe" appraisal is usually in the eye of the HMRC and the courts....
In the eyes of HMRC everyone is caught. So really it comes down to the courts, who've overwhelmingly taken the part of the contractor. (According to PCG propaganda!)

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All those scenarios are 100% true and no contractors pay 5% tax. You really have taken the bait somewhere down the line.
It's just trolling, ignore it. I already gave a breakdown of how contractors pay tax via ltd.co., and what's happened to those who did try various creative solutions to overly reduce their tax burdens. If he chooses to believe the 5% lie, then no amount of evidence is going to change that.

Contractors get paid more to cover risk, and all those things that they'd otherwise get from their employer. In CH, contractors pay more tax than permies, but still that's offset by the higher pay. And, yes, I am a mercenary*. I do the work for money.

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  #44  
Old 13.09.2013, 14:35
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Re: S/W Engineer: Contractor vs Permanent salary

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It's just trolling, ignore it. I already gave a breakdown of how contractors pay tax via ltd.co., and what's happened to those who did try various creative solutions to overly reduce their tax burdens. If he chooses to believe the 5% lie, then no amount of evidence is going to change that.
Are you forgetting that you did acknowledge yourself that it happens? So now that's established let's consider that I've known that these people get away with it for several years and we've connected our dots.

It's challenging for me to prove the extent to which these schemes are used as they're usually arranged behind a good accountant's doors, but there's reference material available around the Internet under "employee benefit trusts" and "loan scheme companies".

Yes, we've seen evidence of retro tax being demanded in these situations, and the fact that they've managed to haul 2bn from users of EBTs is kind of indicative of the fact that they're not as much of a "lie" as you claim they are. But as with most exercises in tax avoidance there's always a new method on the block.

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Despite the fact that HMRC says it has been “in contact” with all known EBT users, law firm Pinsent Masons has calculated that of the 3bn identified as outstanding, about 2bn is "not even under discussion."
The entire game is about having the latest bit of legalese to protect your assets and that's what I feel is completely unethical about the system. Permanent employees who would rather focus their efforts on sharpening their occupational skills are left to suffer.
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  #45  
Old 13.09.2013, 14:43
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Re: S/W Engineer: Contractor vs Permanent salary

Let me explain for the hard of thinking.

The lie is that most contractors pay minimal tax and have got away with it. The truth is, most contractors do not pay minimal tax, and those who attempted to, haven't got away with it.

If you further explore those links, you'll find that the majority of that 2Bn isn't from contractors.
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  #46  
Old 13.09.2013, 14:45
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Re: S/W Engineer: Contractor vs Permanent salary

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In that case there's no unfairness involved. The contractor in question must have agreed to these terms, right?
The terms were 1 month notice both ways. The contractor received no notice whatsoever, although the current short contract had come to an end. The contractor was lead to believe it would be renewed but was only told on the very last day that it had been declined by the purchasing department.
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  #47  
Old 13.09.2013, 14:47
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Re: S/W Engineer: Contractor vs Permanent salary

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Let me explain for the hard of thinking.

The lie is that most contractors pay minimal tax and have got away with it. The truth is, most contractors do not pay minimal tax, and those who attempted to, haven't got away with it.

If you further explore those links, you'll find that the majority of that 2Bn isn't from contractors.
There has been no mention of ratios here and I've not once said I think most contractors pay minimal tax. I don't like the fact that it's possible and that it happens in the first place. There should be plenty of pissed off contractors out there, too.
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  #48  
Old 13.09.2013, 14:49
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Re: S/W Engineer: Contractor vs Permanent salary

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Are you forgetting that you did acknowledge yourself that it happens? So now that's established let's consider that I've known that these people get away with it for several years and we've connected our dots.

It's challenging for me to prove the extent to which these schemes are used as they're usually arranged behind a good accountant's doors, but there's reference material available around the Internet under "employee benefit trusts" and "loan scheme companies".
Your beef is misplaced. You talk about all sorts of fancy tax avoidance schemes (which are being aggressively shut down by HMRC) but I see no evidence that all contractors, even a majority, even a sizeable minority use them.

Before IR35 - a hateful piece of legislation if I see one - contractors simply didn't pay NI but only normal tax. That was the only difference, and it was a fair one. They don't get the perks, shouldn't pay NI.
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Yes, we've seen evidence of retro tax being demanded in these situations, and the fact that they've managed to haul 2bn from users of EBTs is kind of indicative of the fact that they're not as much of a "lie" as you claim they are. But as with most exercises in tax avoidance there's always a new method on the block.
EBTs are not IT contractor-specific. Most IT contractors are small fry with small rates (most rates offered are in the 200-300 region, so they make less than regular employees). I still get 5-10 offers a day from various agencies and I know what I'm talking about.

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The entire game is about having the latest bit of legalese to protect your assets and that's what I feel is completely unethical about the system. Permanent employees who would rather focus their efforts on sharpening their occupational skills are left to suffer.
You tar all contractors with a pretty big brush here, having focused your tax avoidance crusade on a large category of people with widely varying circumstances. Permanent employees have nothing to suffer from IT contractors, quite the opposite. It's usually contractors who do the least sexy, most uninteresting projects.
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  #49  
Old 13.09.2013, 14:51
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Re: S/W Engineer: Contractor vs Permanent salary

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and that's what I feel is completely unethical about the system. Permanent employees who would rather focus their efforts on sharpening their occupational skills are left to suffer.
Something I find amusing is that you are most likely at work just now, posting this in your employers time (or are you still on lunch break?)

On the other hand, I'm at home, unpaid of course, looking after a baby, worried how long it will be until I can find my next contract and studying 40 hours/week in the evenings and weekends to learn some new skills, which may help in the job search.
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  #50  
Old 13.09.2013, 14:53
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Re: S/W Engineer: Contractor vs Permanent salary

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The terms were 1 month notice both ways. The contractor received no notice whatsoever, although the current short contract had come to an end. The contractor was lead to believe it would be renewed but was only told on the very last day that it had been declined by the purchasing department.
No offense - I only believe in a renewal when the contract/purchase order is signed. Until then, it's all fair game.

Unpaid contract-mandated notice is a break in the contract and you can sue. I have, and won easily (they didn't even present their case).
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  #51  
Old 13.09.2013, 15:12
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Re: S/W Engineer: Contractor vs Permanent salary

In the UK, the ability for your client to give you immediate notice is quite good from an IR35 perspective, as it implies no mutuality of obligation - even if you can't give notice at all!

I work on call-off contracts. The clients say they'll use me for a certain number of days - if they use all of it, fine, if they don't, that's fine too. They have to pay a little more for me to be so flexible of course. I have multiple clients so it usually works out well for everyone.
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  #52  
Old 13.09.2013, 15:16
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Re: S/W Engineer: Contractor vs Permanent salary

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No offense - I only believe in a renewal when the contract/purchase order is signed. Until then, it's all fair game.

Unpaid contract-mandated notice is a break in the contract and you can sue. I have, and won easily (they didn't even present their case).
True to a large degree but it was fairly unprofessional and felt like a kick in the teeth. 6 months later they offered a contract but it was too late by then. Just one of the unfair perks of a contractor I guess.
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  #53  
Old 13.09.2013, 15:38
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Re: S/W Engineer: Contractor vs Permanent salary

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True to a large degree but it was fairly unprofessional and felt like a kick in the teeth. 6 months later they offered a contract but it was too late by then. Just one of the unfair perks of a contractor I guess.
I fully understand why something like this can make one feel hard done. It's human nature. But it's neither unfair, nor a perk. It's the core thing about being a contractor - you can be let go with minimal fuss, and they can dither, delay or refuse to renew, and there's nothing unfair about that. In my experience such behaviour is not the product of maliciousness or even stupidity - all forms of human organisation, companies included, have a way of being disorganised
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  #54  
Old 15.09.2013, 23:01
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Re: S/W Engineer: Contractor vs Permanent salary

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It costs several thousand francs to set up a company in Switzerland. For this reason, many contractors go straight down the umbrella/payroll company route.
In general how much do umbrella companies charge in Switzerland?
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  #55  
Old 15.09.2013, 23:35
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Re: S/W Engineer: Contractor vs Permanent salary

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Contract: Unless you provide for it yourself

No sick leave
No paid vacation
No security
No pension
No insurance cover
No training

And employers' social contribution comes from your fee. Roughly, a contractor would need to be in place for ~2 years before it would have been more cost-effective for them to be permanent.

I prefer to contract because:
No appraisals
No target setting
No/reduced politics
On top of all this, 700 x day is on the lowest end, really, and they are going to keep pushing the rate down after every contract renewal until you get sick of it. Another aspect is that you are going to get surrounded by a bunch of other angry bird contractors that are all competing to get their contract renewed and that usually means to annihilate the competition by all sorts of tricks, personal attacks and undermining strategies but the OP being a SE for so long should already be used to the SE hell.
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  #56  
Old 25.12.2013, 08:45
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Re: S/W Engineer: Contractor vs Permanent salary

Hello Ladies and Gents,

Hope you are all doing fine as always.

I would be grateful if you could please let me know if the salary I m offered would be fine live in swiss along with some savings.

I would start working in Zurich with an investment bank starting 15Jan14 on a salary of 137,000 CHF per annum (Gross). I would be moving there with my wife and 1 kid (3 yr old). Will the salary be enough to cover the housing, kids school etc. My wife is not working. Also the insurance is paid by my company.
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  #57  
Old 25.12.2013, 10:14
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Re: S/W Engineer: Contractor vs Permanent salary

You will be more than fine.
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  #58  
Old 25.12.2013, 10:32
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Re: S/W Engineer: Contractor vs Permanent salary

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You will be more than fine.
Assuming local schools, Private international schools are expensive,
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Old 25.12.2013, 12:50
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Re: S/W Engineer: Contractor vs Permanent salary

I know it's festive season and I have enough time at hand to catch up with important things... At the same time I hate reading dedicated threads on the EF, but this is just me ... So pls bear with me.

I just wanted to ask if my wife and I who will earn hundred grant per annum each, can make a comfortable living in Swiss (read Switzerland), yet without pissing off other less privileged folks who need to make ends meet on much lower income than ours?
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  #60  
Old 25.12.2013, 14:54
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Re: S/W Engineer: Contractor vs Permanent salary

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I know it's festive season and I have enough time at hand to catch up with important things... At the same time I hate reading dedicated threads on the EF, but this is just me ... So pls bear with me.

I just wanted to ask if my wife and I who will earn hundred grant per annum each, can make a comfortable living in Swiss (read Switzerland), yet without pissing off other less privileged folks who need to make ends meet on much lower income than ours?
100k in AG is plenty.
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