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psychocandy
3rd November 2015, 11:34
I guess this will be when the changes to both expenses and dividend tax will be confirmed as commencing April 2016?

pjt
3rd November 2015, 11:46
I guess this will be when the changes to both expenses and dividend tax will be confirmed as commencing April 2016?

That's the date I'm expecting to get full details. At which point I guess we all need to run through the numbers and see how bad things actually are! Can't say I'm looking forward to the budget but at least then we know for sure whats going to happen.

jamesbrown
3rd November 2015, 11:48
I guess this will be when the changes to both expenses and dividend tax will be confirmed as commencing April 2016?

The dividend tax will be in Finance Bill 2016 according to the summer budget documents but, yes, T&S should be clarified on 25 Nov and both (assuming the T&S goes ahead) will be implemented in April 2016.

psychocandy
3rd November 2015, 11:50
The dividend tax will be in Finance Bill 2016 according to the summer budget documents but, yes, T&S should be clarified on 25 Nov and both (assuming the T&S goes ahead) will be implemented in April 2016.

Right so when will we know if its on or not? When is Finance Bill planned for? Yes 2016!

TheFaQQer
3rd November 2015, 12:51
I would expect there to be further "news" / "clarification" on IR35 in the Autumn Statement as well.

I'd be astounded if there wasn't.

jamesbrown
3rd November 2015, 13:23
Right so when will we know if its on or not? When is Finance Bill planned for? Yes 2016!

The Finance Bill we just outline the details of the implementation. I think the draft is scheduled for mid-December (9th IIRC), and that's pretty typical. The dividend tax itself is a done deal; they're relying on the revenues :eyes

On the T&S, it remains a possibility that the proposal will change substantially (as it did between discussion and consultation :eyes), although that is quite unlikely in practice. If it doesn't change substantially, that will be an indication of the direction in which things are heading w/r to IR35, but not a guarantee. In terms of any IR35 changes, they are mooted for Finance Bill 2017, and I would expect an extensive consultation on this prior to implementation (famous last words :laugh). As TF says, there will likely be an update in the Autumn Statement. Davis Morris has also indicated that he's pursuing a new tax strategy for self-employed workers (probably IPSE's FLC), so there may be an update soon about whether that is gaining traction with the Treasury, BIS and HMRC etc.

MrMarkyMark
4th November 2015, 10:00
Davis Morris has also indicated that he's pursuing a new tax strategy for self-employed workers (probably IPSE's FLC), so there may be an update soon about whether that is gaining traction with the Treasury, BIS and HMRC etc.

I just think this is such a bad idea, FLC, separating ourselves out.
Stinks of rolling over and trying to preserve IPSEs commercial interests, within the contracting market.

mudskipper
4th November 2015, 11:05
Stinks of rolling over and trying to preserve IPSEs commercial interests, within the contracting market.

Whilst I'm not a fan of the idea, I can't see how that stands - if one accepts that a lot of members are there for the insurance, and a FLC means that insurance is not required, then I can't see how IPSE benefit.

MrMarkyMark
4th November 2015, 11:09
then I can't see how IPSE benefit.

I'm sure they will find a way, don't you think they will be thinking of one?
Otherwise, why suggest the idea, I doubt its from the bottom of their heart?

mudskipper
4th November 2015, 11:37
I'm sure they will find a way, don't you think they will be thinking of one?
Otherwise, why suggest the idea, I doubt its from the bottom of their heart?

I'm sure they are considering their role in the future landscape, but I'm still not clear what you think they can gain from the proposal other than the kudos of its success, or the fallout of its failure.

They are a not for profit organisation.

TheFaQQer
4th November 2015, 11:51
I'm sure they will find a way, don't you think they will be thinking of one?
Otherwise, why suggest the idea, I doubt its from the bottom of their heart?

If there is a voluntary mechanism which protects some members from HMRC, then would that count as being from the bottom of their heart?

I'm not sure how an FLC option being available helps further the commercial interests - how do you think it can be used to make money?

MrMarkyMark
4th November 2015, 11:58
I'm not sure how an FLC option being available helps further the commercial interests - how do you think it can be used to make money?

If it goes through and you have to have the "operating criteria" reviewed, to remain outside IR35, then wouldn't IPSE be offering this as a paid service?

Or have I missed something :)

TheFaQQer
4th November 2015, 13:26
If it goes through and you have to have the "operating criteria" reviewed, to remain outside IR35, then wouldn't IPSE be offering this as a paid service?

Or have I missed something :)

From the suggested operating criteria in the final version of the proposal submitted to government, I don't see anything that couldn't / wouldn't be done by companies house or HMRC - but there is nothing in the document which says what kind of ongoing review would be required or who would do it.

I doubt that HMG are going to outsource any possible review service to a third party - in the same way that they don't outsource their contract review service to AbbeyTax or B&C or Qdos.

MrMarkyMark
4th November 2015, 13:32
From the suggested operating criteria in the final version of the proposal submitted to government, I don't see anything that couldn't / wouldn't be done by companies house or HMRC - but there is nothing in the document which says what kind of ongoing review would be required or who would do it.

I doubt that HMG are going to outsource any possible review service to a third party - in the same way that they don't outsource their contract review service to AbbeyTax or B&C or Qdos.

The thing is we just don't yet know for certain..
I thought it would be similar to a contractor getting their contract reviewed now. Operating criteria could differ, from one contract to another, as working practices do now.

What, in your view, would be IPSEs role, in contracting, if this went through?

As I say, I don't profess to know, all the ins and outs, in as much detail as you.

TheFaQQer
4th November 2015, 14:08
The thing is we just don't yet know for certain..
I thought it would be similar to a contractor getting their contract reviewed now. Operating criteria could differ, from one contract to another, as working practices do now.

Based on the IPSE model, then the operating criteria are unlikely to change from year to year or contract to contract, so there won't be the need to regularly review the way you work.

You must meet the entry criteria to form an FLC (or transition to one, if that channel is possible), and you must maintain the operating criteria to remain working within one. I would expect that if there was an HMRC investigation then you would have to show how you operated and why you were eligible to be an FLC, but that's just how I personally see it working, not based on anything that I've seen or heard.


What, in your view, would be IPSEs role, in contracting, if this went through?
If FLCs go through, I don't see there being much change. Those members that choose to use one will do so, and it may be that if all they were interested in IPSE membership was for IR35 protection then they may well choose to let their membership lapse. If they were IPSE members for more than the IR35 protection, whether that's the lobbying voice that IPSE has, or the business interruption insurance, or the cheap pension plan, or the savings that can be made from IPSE Advantages, or any other reason then I would expect that they would continue to support the only voice in town for contractors.

And for those members that don't choose to use an FLC, IPSE will continue to provide the range of benefits and protection that they have always offered.

MrMarkyMark
4th November 2015, 14:16
Cheers bud, interesting insight..

jamesbrown
4th November 2015, 15:01
or transition to one, if that channel is possible

At the risk of polishing a turd, I think that's going to need some serious polishing. For any contractor whose company has a decent net worth, I can't see HMRC allowing capital distribution in moving to an FLC (it would basically fail the TIS), and I can't see a contractor accepting a dividend distribution or moving the cash to the FLC and accepting an even more punitive environment there (e.g. salary/dividend mix).

Fred Bloggs
4th November 2015, 15:13
The closer to full PAYE tax rates get for contractors, the less reason there is for IR35. It follows directly that there will be little or no need for IPSE to exist.

AtW
4th November 2015, 15:13
Not looking forward to it at all as things will only get worse - now Osborne needs to find more tax money to deal with shortfall as he'd have to stagger tax credits cuts, this would no doubt exclude dividend tax credit cut which would still be immediate next year.

I expect them to neuter Entrepreneurs Relief substantially, or do something to Capital Gains Tax altogether - it wasn't touch in last emergency budget, most likely because they want to do some big changes to it, you know, to make it less "archaic", like all those people getting CGT relief on sale of main house :eyes

TheFaQQer
4th November 2015, 15:59
The closer to full PAYE tax rates get for contractors, the less reason there is for IR35. It follows directly that there will be little or no need for IPSE to exist.

On the assumption that IPSE is only there for IR35, yes.

On the assumption that IPSE is there for significantly more than IR35, no.

And I'm more with the second assumption than the first.

Zero Liability
4th November 2015, 15:59
The closer to full PAYE tax rates get for contractors, the less reason there is for IR35. It follows directly that there will be little or no need for IPSE to exist.

The dividend tax already has that sorted, in that there is scope for it to increase.

Fred Bloggs
4th November 2015, 16:28
The dividend tax already has that sorted, in that there is scope for it to increase.

Exactly, I give IPSE less than five more years before they're irrelevant.