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

[DonkeyRhubarb]

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

[LisaContractorUmbrella]

IMHO I think that this is unlikely to work as a legal argument. Even if you could successfully argue that the individuals using the scheme were employees, which I think would be unlikely for a number of reasons, the individual is still responsible for their own taxes and therefore what would you be gaining?

[ir35amnesia]

IMHO I think that this is unlikely to work as a legal argument. Even if you could successfully argue that the individuals using the scheme were employees, which I think would be unlikely for a number of reasons, the individual is still responsible for their own taxes and therefore what would you be gaining?

I have seen the legal opinion from David Ewart QC (google him - he is very well regarded in the field of tax) who disagrees with Lisa and opines that it does work.

Furthermore WHY have HMRC delayed their technical response for over nine months if it is so "clear cut" that it does not work.

[LisaContractorUmbrella]

I have seen the legal opinion from David Ewart QC (google him - he is very well regarded in the field of tax) who disagrees with Lisa and opines that it does work.

Furthermore WHY have HMRC delayed their technical response for over nine months if it is so "clear cut" that it does not work.

HMR&C move at a snail's pace at the best of times - that's no indication of anything.

Companies who offer dodgy offshore commercial loan, fx, credit card (etc etc) schemes also have QC opinion (as I am also sure Montpelier did) - it's meaningless.

The idea behind this is that you are trying to establish an employer/employee relationship - in any legal case the first thing that will be examined is the contract - were the people using the scheme employed under a written contract of employment? You could argue that there could be an implied contract of employment and this is true but I would imagine that the people using the scheme (opinion based on the tax that they owe) were unlikely to be under the supervision, direction and control of the end client so right from the very start you would fall down on a fundamental argument of employment law i.e. the difference between a contract for service and a contract of service.

The other problem you would have is that, if you try to go down a totally different road and argue that your original contractual arrangements were not representative, you risk the judiciary opining that the original arrangement was a sham and had been operated knowing that this was the case. It is understandable that a business will change and develop over the years and that contracts will change accordingly but this is not the case in this instance.

Obviously all this is just MHO but I agree with DR - fire, frying pan - no doubt

[Vallah]

I have seen the legal opinion from David Ewart QC (google him - he is very well regarded in the field of tax) who disagrees with Lisa and opines that it does work.

Furthermore WHY have HMRC delayed their technical response for over nine months if it is so "clear cut" that it does not work.

Because that's about the standard lengh of time at the bare minimum that it takes HMRC to respond to anything.

This is never going to work in a million years. It might be a useful delaying tactic at best, but you're never going to win the argument that the contractors were employees.

[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

This BN66 alternative is NOT for everyone affected by BN66 and the Huitson Case. Your circumstances have to meet a certain criteria. My guess is that over 80% of contractors who used the scheme will meet the criteria.
If you meet the criteria THEN you have to decide whether the route you have been following i.e. reliance on Human Rights/Huitson Case or writing to MP's will ultimately succeed. If you answer NO to this then you should seriously consider the bn66.co.uk option.
I am not involved in the operational/front end of this although i did have some initial involvement in instructing the QC who gave a positive legal opinion that it worked. BN66.co.uk is being run by Tim Warr FCCA of Warr & co who has been advising Contractors since the early 1980's.

[ir35amnesia]

Because that's about the standard lengh of time at the bare minimum that it takes HMRC to respond to anything.
This is never going to work in a million years. It might be a useful delaying tactic at best, but you're never going to win the argument that the contractors were employees.

Have you heard about something called IR35 and the rules that deem a person to be an employee !!

[cojak]

Title changed to give context.

[ir35amnesia]

I would imagine that the people using the scheme (opinion based on the tax that they owe) were unlikely to be under the supervision, direction and control of the end client

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.

[BrilloPad]

I have seen the legal opinion from David Ewart QC (google him - he is very well regarded in the field of tax) who disagrees with Lisa and opines that it does work.

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