How many HMRC staff are actively working on IR35 issues?

[Alan @ BroomeAffinity]

Since the Dragonfly case came out, I have spoke to countless contractors regarding their status and some of the responses are interesting. I would guess that about 30% (possibly more) of contractors who know that their working practices would constitute an IR35 fail are still willing to operate as if the are fully compliant. Their argument is that the chances of them being enquired into are pretty slim. That may be a fair point but its concerning nonetheless.

I'm trying to establish what the actual chances are: With 1.4million freelancers / contractors in the UK market (according to a PCG commissioned study at Kingston Business School). It would be helpful in the calculation of the odds if we knew how many HMRC staff are actively working on IR35. Does anybody know this information? Is it even available?

Thanks in advance.

[DonkeyRhubarb]

Since the Dragonfly case came out, I have spoke to countless contractors regarding their status and some of the responses are interesting. I would guess that about 30% (possibly more) of contractors who know that their working practices would constitute an IR35 fail are still willing to operate as if the are fully compliant. Their argument is that the chances of them being enquired into are pretty slim. That may be a fair point but its concerning nonetheless.

I'm trying to establish what the actual chances are: With 1.4million freelancers / contractors in the UK market (according to a PCG commissioned study at Kingston Business School). It would be helpful in the calculation of the odds if we knew how many HMRC staff are actively working on IR35. Does anybody know this information? Is it even available?

Thanks in advance.

I don't think you will find many HMRC staff "actively working". Sorry, couldn't resist.

[Alan @ BroomeAffinity]

Very good.

I remember asking a client "How many people work here?" and got the reply "About half of them"

[DonkeyRhubarb]

I don't know if it's true or not but I've read this in a few places that inspections occur on average every 6 years. If that's the average then obviously you could be lucky and go for 10, 15 years or more. I don't know if closing down the company and starting a new one every so often would reduce the overall frequency of inspections.

http://www.taxdebts.co.uk/HMRC-Tax-Inspections.html


PS. I guess the 6 years would make sense if they can only re-open returns going back 7 years.

[Fred Bloggs]

Dragonfly changes everything potentially. Most of us would be caught if our cases went like that one did IMO. There's now very few places to hide from IR35. I'm very seriously considering moving permanently abroad if income shifting comes in next year.

[Turion]

Dragonfly changes everything potentially. Most of us would be caught if our cases went like that one did IMO. There's now very few places to hide from IR35. I'm very seriously considering moving permanently abroad if income shifting comes in next year.

Unless you're already very rich and can move to a tax haven then permanently moving to another European contracting centre will probably not reduce your tax burden. If you're legit, you will probably pay more. There are of course more opportunities to have some/all your earnings paid offshore, and many do, but in the end it's dodgy as many foreign contractors in Germany have found out.