BN66 get out: Any experts here have a view on this?

[LisaContractorUmbrella]

Lisa this is a large part of the reason why contractors use schemes and umbrella companies. IF they were NOT pseudo employees THEN contractors would stick with their PSC's. Ask the PCG.

As i have already stated it is NOT for everyone BUT i guess 80% of contractors will meet the supervision/control test.

So what you are saying is that 80% of the people using the scheme would be under the supervision, direction and control of the end client?? If that was the case then the individual would have been expected to determine their status as being inside IR35 and therefore bound to make salary payments through PAYE and the scheme initiator would have had to work with the individuals as though they were employees - neither of which happened.

HMR&C are very firm on the point that employment status and therefore method of payment of taxes is to be determined by the individual although they do offer guidance on their website - this being the case how on earth is the approach that is being taken here of any use to the people who used the scheme? It would be a case of damned if you do and damned if you don't

[ir35amnesia]

So what you are saying is that 80% of the people using the scheme would be under the supervision, direction and control of the end client?? If that was the case then the individual would have been expected to determine their status as being inside IR35 and therefore bound to make salary payments through PAYE and the scheme initiator would have had to work with the individuals as though they were employees - neither of which happened.

HMR&C are very firm on the point that employment status and therefore method of payment of taxes is to be determined by the individual although they do offer guidance on their website - this being the case how on earth is the approach that is being taken here of any use to the people who used the scheme? It would be a case of damned if you do and damned if you don't

You are missing an NB point. It is quite technical (specific legislation deals with agency workers working for an offshore firm/company which IS WHAT HAPPENED WITH THE CONTRACTORS WORKING FOR A IOM PARTNERSHIP) BUT in very simple layman's terms it is the duty of the pseudo employer to make the correct "call" on status - that is why Umbrella companies get detailed questionnaires from Agencies BECAUSE they are trying to protect themselves from being labelled as the employer with responsibility for tax) . (If you tried to undertake a 3 month IT contract as a "sole trader" with any decent sized company they would laugh at you and KICK you to an agency who in turn BULLY you to a Ltd Company setup OR "umbrella".).
SO it would be a case of the pseudo employer is damned and liable to pay the tax whilst the contractor is damned lucky and "gets out" of BN66.

BUT NOT everyone will qualify to make the starting line up and even then it is NOT guaranteed.

[JamJarST]

You are missing an NB point. It is quite technical (specific legislation deals with agency workers working for an offshore firm/company which IS WHAT HAPPENED WITH THE CONTRACTORS WORKING FOR A IOM PARTNERSHIP) BUT in very simple layman's terms it is the duty of the pseudo employer to make the correct "call" on status - that is why Umbrella companies get detailed questionnaires from Agencies BECAUSE they are trying to protect themselves from being labelled as the employer with responsibility for tax) . (If you tried to undertake a 3 month IT contract as a "sole trader" with any decent sized company they would laugh at you and KICK you to an agency who in turn BULLY you to a Ltd Company setup OR "umbrella".).
SO it would be a case of the pseudo employer is damned and liable to pay the tax whilst the contractor is damned lucky and "gets out" of BN66.

BUT NOT everyone will qualify to make the starting line up and even then it is NOT guaranteed.

Surely though the employee is then unjustly enriched?

[ir35amnesia]

Of course montp had legal opinion from a QC that their scheme worked. Fat lot of good that did.

Actually Montpelier took an opinion from a Junior Barrister NOT a QC. AND we will never know whether or not the scheme worked.

BUT everyone is missing the point about bn66.co.uk . It is NOT a scheme it is using the legislation that HMRC defend to "the hilt (sic)". HAVE you ever seen case law where HMRC were arguing that someone was NOT an employee BUT self employed.

SO if you say you were actually an employee BUT your pseudo employer treated you otherwise (in order to avoid employer NI etc etc) THEN are HMRC going to drag you through the courts to prove that you were NOT employee and that IR35 did NOT apply etc etc.

[ir35amnesia]

Surely though the employee is then unjustly enriched?

OR the amount the contractor/employee received was the NET pay after the pseudo employer had/should have accounted for tax/NI.

[LisaContractorUmbrella]

You are missing an NB point. It is quite technical (specific legislation deals with agency workers working for an offshore firm/company which IS WHAT HAPPENED WITH THE CONTRACTORS WORKING FOR A IOM PARTNERSHIP) BUT in very simple layman's terms it is the duty of the pseudo employer to make the correct "call" on status - that is why Umbrella companies get detailed questionnaires from Agencies BECAUSE they are trying to protect themselves from being labelled as the employer with responsibility for tax) . (If you tried to undertake a 3 month IT contract as a "sole trader" with any decent sized company they would laugh at you and KICK you to an agency who in turn BULLY you to a Ltd Company setup OR "umbrella".).
SO it would be a case of the pseudo employer is damned and liable to pay the tax whilst the contractor is damned lucky and "gets out" of BN66.

BUT NOT everyone will qualify to make the starting line up and even then it is NOT guaranteed.

Oddly enough I know how an umbrella company works Your argument still rests on proving the employment status of the individuals working through the scheme though does it not?

[ir35amnesia]

Some people affected by BN66 are considering this as a possible way out:
Budget Note 66 (BN66); The Point Of No Return
People are desperate, and I am concerned that they may be jumping out of the frying pan into the fire.
Anyone have any opinions?
Many thanks
DR

It is important to note that NOT all contractors affected by BN66 would qualify for the bn66.co.uk alternative. AND even then it is NOT guaranteed. PLUS a choice has to be made - do you carry on as is OR change course to bn66.co.uk. Changing course could mean that if as a result of writing to MP's and/or the process of the tax tribunals BN66 is defeated YOU may NOT be able to participate in this victory.

[LisaContractorUmbrella]

It is important to note that NOT all contractors affected by BN66 would qualify for the bn66.co.uk alternative. AND even then it is NOT guaranteed. PLUS a choice has to be made - do you carry on as is OR change course to bn66.co.uk. Changing course could mean that if as a result of writing to MP's and/or the process of the tax tribunals BN66 is defeated YOU may NOT be able to participate in this victory.

Bit of a contradiction don't you think?

[JamJarST]

OR the amount the contractor/employee received was the NET pay after the pseudo employer had/should have accounted for tax/NI.

Sounds like a hell of a stretch to me.

[DownButNotOut]

It is important to note that NOT all contractors affected by BN66 would qualify for the bn66.co.uk alternative. AND even then it is NOT guaranteed. PLUS a choice has to be made - do you carry on as is OR change course to bn66.co.uk. Changing course could mean that if as a result of writing to MP's and/or the process of the tax tribunals BN66 is defeated YOU may NOT be able to participate in this victory.

After todays budget it pretty clear that retrospective action applied to artifical tax avoidance schemes are fair game. If anybody thinks writing to MP's will make any difference is deluded.

What progress has been made with bn66.org?
Given you've only waited 9 months why didn't Suto clients adopt this strategy?