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IR35: Planning for April 2021 – should I stay or should I go?

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    Originally posted by cojak View Post
    I’ll be surprised if the agent and client don’t go after you for the PAYE if/when HMRC go after them.

    Or HMRC will simply go after you for PAYE for the whole contract.
    I'm sure this has been discussed before and our resident tax/accounting experts have stated that their is no mechanism (in law) for HMRC to come after the contractor for post-April taxes, nor for the client/agency to attempt to pass such a liability onto the contractor.

    Of course, the risk is that, after HMRC chase the client for tax 6 months down the line, the client belatedly determines someone inside and HRMC goes after that person for pre-April 2020 taxes.

    Comment


      Originally posted by Paralytic View Post
      I'm sure this has been discussed before and our resident tax/accounting experts have stated that their is no mechanism (in law) for HMRC to come after the contractor for post-April taxes, nor for the client/agency to attempt to pass such a liability onto the contractor.

      Of course, the risk is that, after HMRC chase the client for tax 6 months down the line, the client belatedly determines someone inside and HRMC goes after that person for pre-April 2020 taxes.
      I'm looking backwards in that post Paralytic, ala IR35 inspectors to probe public PSCs retrospectively
      "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
      - Voltaire/Benjamin Franklin/Anne Frank...

      Comment


        Quote from the link cojak just posted

        But the risk of retrospective IR35 investigation isn’t confined only to the contracts with the public sector body the PSC is supplying at the time of a ‘caught’ decision. In fact, Qdos said:

        “If you’re declared inside IR35 by your public sector employer…[HMRC] could then knock at your door with a frightening tax bill for all the work you carried out before April.”

        I know HMRC have tried making promises since then......but ignoring them......it sounds like QDOS think anyone who gets an inside SDS is at higher risk of their whole history being investigated, regardless of whether that SDS was at a new client, regardless of any of your history.

        So maybe quitting now (before an SDS for your current gig) and starting on an inside gig somewhere else isn't such a strong move as some make it sound......but still a step in the right direction.

        Comment


          Originally posted by Paralytic View Post
          I'm sure this has been discussed before and our resident tax/accounting experts have stated that there is no mechanism (in law) for HMRC to come after the contractor for post-April taxes.....
          Fast forwarding 10 years down the line, and the emboldened may sound somewhat quaint. 10 years, by then, having afforded awareness and experience.

          From a more contemporary viewpoint however, HMRC having a crack at Loan Charge people for the past 20 years, when, by law, tax affairs are deemed Closed after seven years, is a little bit too close, to home and, for comfort.

          Until a new playing field is levelled out over the course of time, I would submit looking Beyond the law may afford sleepful nights and fewer surprises.
          Last edited by simes; 27 November 2019, 10:39.

          Comment


            Re: SDS

            Hi, slightly unclear on one part of this; when the client makes the status determination, say in January, presumably they don’t send this (ie the SDS) to HMRC or notify them in some way? I’m just trying to understand the ‘risk’ of having a status determination in the case where you are planning to cease working for the client pre-April 2020 legislation kicking in (ie final invoice submitted end of Feb). How would it raise the risk of HMRC investigation in this case?

            Many Thanks

            Comment


              Currently at a client and my outside IR35 contract ends in two weeks .... with a furlough break and an option to go PAYE in January - probably on a short term basis only. They are not doing a determination - just ceasing to use PSCs.

              I've started looking for new contracts in the meantime and have a final interview tomorrow for a role. I'll be asking to ensure them if role is considered outside IR35 (agent says it is but I'd get contract checked should I get the gig).

              Is there anything else I can actively ask at this stage of the client in terms of role determination? I imagine the contract will run till around March and beyond that I don't know.

              I'm trying to also determine whether there is any value in taking a contract with a new client for a couple of months versus the PAYE option I have at my current client - especially if I end up with a situation where I would take a contract with the new client and leave the them in Feb (I would imagine the role to be determined inside IR35 come April).

              Such a mess this is

              Comment


                Originally posted by Changingplaces View Post
                Hi, slightly unclear on one part of this; when the client makes the status determination, say in January, presumably they don’t send this (ie the SDS) to HMRC or notify them in some way? I’m just trying to understand the ‘risk’ of having a status determination in the case where you are planning to cease working for the client pre-April 2020 legislation kicking in (ie final invoice submitted end of Feb). How would it raise the risk of HMRC investigation in this case?

                Many Thanks
                Until the new legislation is introduced, the client cannot deduct anything from your invoice. There is no mechanism to tell HMRC whether they think you are inside or outside IR35 - HMRC could start an investigation into every contractor and then ask the client as part of that, but there is no automated method to communicate that.
                I'm not fat, I'm just fluffy.

                Comment


                  Originally posted by DeludedKitten View Post
                  Until the new legislation is introduced, the client cannot deduct anything from your invoice. There is no mechanism to tell HMRC whether they think you are inside or outside IR35 - HMRC could start an investigation into every contractor and then ask the client as part of that, but there is no automated method to communicate that.
                  Thanks

                  Comment


                    Originally posted by DeludedKitten View Post
                    Until the new legislation is introduced, the client cannot deduct anything from your invoice. There is no mechanism to tell HMRC whether they think you are inside or outside IR35 - HMRC could start an investigation into every contractor and then ask the client as part of that, but there is no automated method to communicate that.
                    Agencies (and companies) do have a legal requirement under the Agency reporting act to report all payments to 3rd parties for work done directly to HMRC and that information needs to include the person NI number.
                    merely at clientco for the entertainment

                    Comment


                      So company i'm working for atm has my contract finishing early Feb 2020 (Outside IR35), they have made to blanket decision to stop using PSC's and have all contractors via umbrella, and not bother with doing IR35 determinations themselves.

                      Had them call me recently and ask if i was to be extended would i move to an umbrella, and wanted my decision now, basically i told them based on what i have researched i'm not happy to potentially open myself up to retrospective liability for my previous work there for i would be leaving. I'd been bouncing around between large projects for a few years. (Each time i finished one bit of work they looked for me to move to new project, and most took about a year to deliver). They seems genuinely surprised that i would not continue, i know quite a few at this company that have also said the same, though I'm also surprised at the number of people in this company who are just going to stay on under umbrella. Tried even to say there would be no liability for pre april 2020 work

                      Previous HMRC behaviour makes me think staying with same end client is too much of a potential risk (even though i have solid case for outside in my case) for me personally and prefer to start (in or out) with complete new company under the new rules. Start fresh so to speak.

                      Plus i could do with a couple of months off.
                      Last edited by QuantumX; 9 December 2019, 12:25.

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