Work Stories – Resign Yourself?



I currently work for this global communications company based in Central Scotland, if you live in the UK, you probably use or have used its services as they have a tight grip on some of the best available premium content.

You might know the place, very technical, a bigger technical base than any of the banks that I’ve worked for with the exception of JP Morgan.

I’m a contractor, self-employed and run a small personal services company ( ooooh-err missus ) for tax efficiency purposes.

Did you hear that? Tax-efficiency purposes?

What does that mean?

Well efficiency in a physics sense is defined as the ratio to energy in vs energy out.

In this context, it’s the amount of money that my company earns vs the amount of cash that I abscond with . take home .. by reducing my tax and national insurance rather than paying full PAYE.

My accountant is a wee whizz at all that stuff, for a mere £100pm, he makes sure that I don’t get caught in the 40% tax bracket as that’s just like throwing money away.

HMRC just loves us small-contractors and see’s us as rich pickings and over the past few years have been changing the tax regulations particularly IR35 to try and either include most of us contractors within the PAYE rules or drive us into permanent staff positions where we would be paying full PAYE and most likely the higher rate tax as the only reason that we are contacting is because our knowledge and skills are in demand.

If you’re unemployed or a low-earner reading this, then your most likely thinking, “fuck you pal, pay your taxes like everyone else”.

Yep I didn’t think I’d get much sympathy there .. and not looking for it either.

Truth is,  contractors are not evading tax, for the PAYE that I don’t pay, I make a significant contribution both in corporation tax at 22% and in VAT at 20%.

But the fact remains, contractors would be paying more if they were forced to pay PAYE.

However, here’s the rub, even when in a previous role in the public sector and I was caught in the IR35 rules and forced into paying full PAYE on my contracted earnings, I paid the tax but received no staff benefits, no holiday pay, no sickness pay, no bonus, no private health care etc.

Not a damn thing.

Currently contractors are weighing up the benefits of operating our own taxes vs those gained in decent staff position.

HMRC are in process of changing the IR35 rules again, it’s looking likely that more contractors including those in the private sector like myself may start looking for permanent positions, it’s almost inevitable that day is coming.

The good old days of contracting might be coming to an end.

Not if this bhoy can help it.

Fortunately my paternal grand-mother, the old b@stard who disappeared and left my dad when he was 10 years old and my uncle Eddie was 18 months, was Irish and I can claim citizenship of the republic.

I’ve no idea how that would affect my tax position if operating an Irish based company in the UK, but got to be worth a look.

But I digress …

The real point of this blog was that for the past 6 months I’ve worked with a project manager on the redesign of a major part of this business, it has high value and tight deadlines, but I’m on top of it.

Over the course of this 6 months I’ve got to know the PM quite well, she’s good at organising things not very technical, that’s what she relies on guys like me for. She’s the typical PM, she usually asks you about some task and how you will do it .. and you know what the next questions are .. how much effort and when will you get it done?

But today, she resigned, bang, gone and not a word .. not even a cheerio email.

All that, can you do this, can you do that, this is really important and gone without a whisper.

I liked her, we got on well as people and not even a good-bye email to the team.

Makes you wonder, did she jump or was she pushed?

It also puts things in perspective doesn’t it, people can be fickle. Work colleagues can become friends but mostly they are just acquaintances with whom we share the journey for a little while then we move on to something else.

But, I’ve not resigned myself to that as over my 25 years of contracting I’ve worked in many places and have gained friends at most places.

People, good, bad or indifferent, you’ve really got to take them as you find them.

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