Employer NI Public Sector Contract Employer NI Public Sector Contract
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  1. #1

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    Default Employer NI Public Sector Contract

    Just to give you some background.

    I was contracting through my LTD company to a public sector client using an agency, the role was deemed outside IR35 until November last year when it was moved inside.

    The agency said I could still use them for payroll and i signed a new contract with the rate in the contract set. I gave them all my personal details including my NI number for deductions etc...

    I carried on working there until the summer but stupidly never checked my payslips they would provide every month. It was only when I left that I noticed they had been deducting Employers NI from my daily rate as well employees NI and Income Tax. The money was paid into my personal account as expected.

    I now read that they should not be doing this and the Employers NI should have been charged to the client and paid by the agency on my behalf. When we talked about the new contract no mention of this deduction was made and the daily rate was clearly stated in my new contract with no mention of the deductions to be made for Employers NI.

    Where do I stand on this? Can I demand the money be paid back to me by the agency? I tried to find a similar thread on this and found people talking about a chargeable amount but was not sure what this was.

    Thank you.

  2. #2

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    I sure david Chaplin (contractorcalculator) has a number of employer tribunal, cases over inappropriate employer NI deductions so search for him and ask what is happening with those cases
    merely at clientco for the entertainment

  3. #3

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    Quote Originally Posted by SheffTest View Post
    Just to give you some background.

    I was contracting through my LTD company to a public sector client using an agency, the role was deemed outside IR35 until November last year when it was moved inside.

    The agency said I could still use them for payroll and i signed a new contract with the rate in the contract set. I gave them all my personal details including my NI number for deductions etc...

    I carried on working there until the summer but stupidly never checked my payslips they would provide every month. It was only when I left that I noticed they had been deducting Employers NI from my daily rate as well employees NI and Income Tax. The money was paid into my personal account as expected.

    I now read that they should not be doing this and the Employers NI should have been charged to the client and paid by the agency on my behalf. When we talked about the new contract no mention of this deduction was made and the daily rate was clearly stated in my new contract with no mention of the deductions to be made for Employers NI.

    Where do I stand on this? Can I demand the money be paid back to me by the agency? I tried to find a similar thread on this and found people talking about a chargeable amount but was not sure what this was.

    Thank you.
    Normal practice above in all cases I’ve seen, what does your contract say?

    You should really be worried about HMRC now coming after you for all back taxes as effectively you have confirmed you should have been inside IR35 all along , HMRC will put you at the top of zzzzzlist


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  4. #4

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    Quote Originally Posted by GhostofTarbera View Post
    You should really be worried about HMRC now coming after you for all back taxes as effectively you have confirmed you should have been inside IR35 all along , HMRC will put you at the top of zzzzzlist
    Well no. Not necessarily.

    If he joined after April 2017 then it’s always been the public sector clients determination. So no risk to the OP.

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    Quote Originally Posted by MrButton View Post
    Well no. Not necessarily.

    If he joined after April 2017 then it’s always been the public sector clients determination. So no risk to the OP.
    Same role outside to inside is always a risk.

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    Quote Originally Posted by ladymuck View Post
    Same role outside to inside is always a risk.
    Not in the public sector where the determination is 100% the responsibility of the "employer". Could you spell out what risk to the contractor actually exists and from where?
    merely at clientco for the entertainment

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    You should have been given a Key Information pack detailing your rate and what deductions would be made. Agencies seem to forget that they have to do that. However, as you never bothered checking your payslips, I suspect you wouldn't have read that either.

    Do raise it with the agency but chances of recovery are slim. If the agency never received Eer's NI from the client they would have had to deduct it from you. That depends on the contract between the agency and the client.

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    Quote Originally Posted by eek View Post
    Not in the public sector where the determination is 100% the responsibility of the "employer". Could you spell out what risk to the contractor actually exists and from where?
    Sorry. Missed the public bit.

    My other post is probably complete crap too then

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    Quote Originally Posted by ladymuck View Post
    Sorry. Missed the public bit.

    My other post is probably complete crap too then
    Key information packs only arrived in April - so again sadly yes.

    As I said in my first post there is a strong possibility that the is a valid reason to seek the return of the employer NI deductions on the basis that they were illegally deducted. The person who is most interested in that side of things is David Chaplin so I would recommend finding him on LinkedIn / ContractorCalculator and asking him where the cases he is aware of have got to.

    Ideally IPSE would be running with this but
    merely at clientco for the entertainment

  10. #10

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    Thank you for all the responses.

    I didn't have any Key Information sheets sent to me. The schedule just stated £xxx per day inside IR35

    The only section in the contract which talks about taxes is this

    The Company shall be solely responsible for all tax liabilities, national insurance
    contributions and any other taxes and deductions payable in respect of the Individual
    and any other person for the provision of the Services and the Company hereby
    indemnifies the Supplier and the Contracting Body in respect of all claims against the
    Supplier (or, as the case may be, the Contracting Body) that may be made by HMRC
    or any other government department (including any of their arm’s length bodies) with
    respect to tax liabilities, national insurance contributions and any other deductions
    (including without limitation interest and penalties).

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