• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

IR35: Backdated complications if new offer is inside IR35

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    #21
    Originally posted by northernladuk View Post
    You can see why, with 5 years under your belt and no other consideration for options except to stay, HMRC is gonna look at you like a starving dog. This is exactly the situation they are after and is what they've been after for all these years.

    I would certainly not want to be in your shoes in an inside gig with that time behind me.
    I can see a new IR35 calculator appearing on the usual sites.

    Provide how long you've been at the client, and your day rate for each year, and it tells you how much tax, interest and penalties you might be liable if (when?) HMRC come calling. Could be quite scary.

    Of course, it'll then try to sell you some insurance to protect against the tax bill, or a scheme to get around it (both with commission earning referral links).

    Comment


      #22
      Originally posted by fidot View Post
      ... but how does the client know you are working through a brolly?
      Because the client will instruct the agency that umbrellas are the way to go and will probably have something in their contract to state that.
      "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


        #23
        Originally posted by WordIsBond View Post
        I was addressing OP's situation where it appears that A) the decision has already pretty much been made and B) he seems to want to stay. So, if that's the way the land lies, his best chance is to go brolly before the determination is made.

        If you think there's a chance of getting an outside determination, sure, you might want to stick around. But in that case I think it would be wise to be prepared to walk as soon as you are told it is going the wrong way.
        The client has already thrown you under the bus at this point, I would not trust them to support my PSC against historic IR35.
        Make Mercia Great Again!

        Comment


          #24
          Originally posted by BlueSharp View Post
          The client has already thrown you under the bus at this point, I would not trust them to support my PSC against historic IR35.
          Yup you got it. Client knows your a disguised permie and done you in. Now you are well within ir35 HMRC will be on you like hot cakes. If I was in your position I would find another job and leave. Giving you 15 20 30 heck 100 extra a day isn't going to cut it!

          Comment


            #25
            Originally posted by cosmic View Post
            Yup you got it. Client knows your a disguised permie and done you in.
            It doesn't always have to be the case! We all heard of big clients deeming everyone inside simply because they don't want the hassle or the potential liability of determining in a case to case basis.

            Don't tell me you believe every contractor at Lloyds or Barclays (just to mention two very known examples) are disguised permies…!
            "The boy who cried Sheep"

            Comment


              #26
              Originally posted by CryingSheep View Post
              It doesn't always have to be the case! We all heard of big clients deeming everyone inside simply because they don't want the hassle or the potential liability of determining in a case to case basis.

              Don't tell me you believe every contractor at Lloyds or Barclays (just to mention two very known examples) are disguised permies…!
              Lets war game the scenario post April 2020.

              Some clients are savvy and start setting up proper B2B contracts but first need to clear the decks where the lined is blurred (i.e. Banks and big enterprise). HMRC will leave these alone as both client AND PSC are in-agreement the role is outside after both sides being advised by legal experts + insurance backed. I expect to see this late 2020/ early 2021. Typical project saving cost 20% + access to skilled labour market makes it a no brainier. Every one else is inside including the switchers.

              HMRC have a list via the agency reporting requirement of all those who went outside > inside April 2020. Or can request the information of all current contractors from a client now the liability is switched. HMRC start a fishing expedition (GSK style).

              HMRC have a document from the client saying the engagement is deemed inside ir35. What evidence can the PSC provide to refute that. Enquiry opened.

              A contractor accepts an April 2020 inside determination and does not try the clients status appeal process or the appeal finds that the role is inside. How will that look to the court when looking at the prior April 2020 years. Enquiry opened.


              Who do you think HMRC is going to go after?
              Last edited by BlueSharp; 2 October 2019, 10:43.
              Make Mercia Great Again!

              Comment


                #27
                Originally posted by BlueSharp View Post
                Lets war game the scenario post April 2020.

                Some clients are savvy and start setting up proper B2B contracts but first need to clear the decks where the lined is blurred (i.e. Banks and big enterprise). HMRC will leave these alone as both client AND PSC are in-agreement the role is outside after both sides being advised by legal experts + insurance backed. I expect to see this late 2020/ early 2021. Typical project saving cost 20% + access to skilled labour market makes it a no brainier. Every one else is inside including the switchers.

                HMRC have a list via the agency reporting requirement of all those who went outside > inside April 2020.

                HMRC have a document from the client saying the engagement is deemed inside ir35. What evidence can the PSC provide to refute that.

                A contractor accepts an April 2020 inside determination and does not try the clients status appeal process or the appeal finds that the role is inside. How will that look to the court when looking at the prior April 2020 years.

                Who do you think HMRC is going to go after?
                Agreed. If you accept an extension deemed inside (correctly or not) I agree it will be very hard to prove the old contract being outside.

                Was just saying, just because a client makes a blanket determination of every contractor inside doesn't mean the client knows/believes everyone was a disguised permie.
                "The boy who cried Sheep"

                Comment


                  #28
                  Originally posted by BlueSharp View Post
                  HMRC have a list via the agency reporting requirement of all those who went outside > inside April 2020. Or can request the information of all current contractors from a client now the liability is switched. HMRC start a fishing expedition (GSK style).
                  The big boys who have stated their intentions seem fairly clear that inside IR35 PSC isn't an option they'll offer. Most seem to be saying PAYE or sod off (or possibly umbrella).

                  Could be a bunch of reasons for this, though I appreciate the main one is simply they CBA with worrying over IR35 status. However, whilst their choice isn't ideal for contractors who would prefer outside, I think it's better for contractors than being kept on as inside IR35.

                  Ie it won't be a simple case of contractor's still a contractor, doing the same work, same contract, just suddenly inside IR35 (in which case I agree it would put a big question mark over pre April 2020 status). Instead it will be completely new contract, which is an employment one, inevitably also leading to lots of other things/changes going on. Yes it may be that on a day to day basis the individual will be doing broadly the same thing, but it will be a clear distinction. In that situation, I personally don't think it's a given that the pre April 2020 contracting work would then be an easy target for HMRC to challenge.

                  Comment


                    #29
                    Originally posted by Maslins View Post
                    The big boys who have stated their intentions seem fairly clear that inside IR35 PSC isn't an option they'll offer. Most seem to be saying PAYE or sod off (or possibly umbrella).

                    Could be a bunch of reasons for this, though I appreciate the main one is simply they CBA with worrying over IR35 status. However, whilst their choice isn't ideal for contractors who would prefer outside, I think it's better for contractors than being kept on as inside IR35.

                    Ie it won't be a simple case of contractor's still a contractor, doing the same work, same contract, just suddenly inside IR35 (in which case I agree it would put a big question mark over pre April 2020 status). Instead it will be completely new contract, which is an employment one, inevitably also leading to lots of other things/changes going on. Yes it may be that on a day to day basis the individual will be doing broadly the same thing, but it will be a clear distinction. In that situation, I personally don't think it's a given that the pre April 2020 contracting work would then be an easy target for HMRC to challenge.
                    I agree we won't see inside PSC arrangements not when it's easier for an agency to regulate using their own PAYE or Umbrella companies. I'm not convinced suddenly having employee perks will protect an individual from prior years investigations unless the role is substantially different. There is an existing precedence for this in the old ir35 Friday-Monday switch at the same client automatically being caught unless the role is substantially different.
                    Last edited by BlueSharp; 2 October 2019, 11:17.
                    Make Mercia Great Again!

                    Comment


                      #30
                      Originally posted by BlueSharp View Post
                      I'm not convinced suddenly having employee perks will protect an individual from prior years investigations unless the role is substantially different. There is an existing precedence for this in the old ir35 Friday-Monday switch at the same client automatically being caught unless the role is substantially different.
                      Fair point with the second sentence above. I think people (worker and client) will be more careful this time. Also that was people moving "the other way" so to speak.

                      Re first sentence quoted, I'm not saying they'll be protected, just it won't be a case of everything is the same except for decision on IR35. Other things will change too, for both sides. In turn this makes me think if HMRC want to challenge the old work, they'll need to do it based on the information relating to that work, rather than saying "you're inside now and nothing's changed, so you were inside then". Ie I don't think that work would be any more at risk than it is now.

                      Comment

                      Working...
                      X