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supersteamer
12th December 2015, 13:19
In the upcoming finance bill am I correct in understanding liability for invalid T&S claims could be transferred to an agency or end client if the contractor is retrospectively found within IR35 but defaults on payment?

In that case won't this put a lot of pressure to needlessly force lots of new contracts into IR35 by agents/clients trying to avoid this risk?

jamesbrown
12th December 2015, 13:33
In the upcoming finance bill am I correct in understanding liability for invalid T&S claims could be transferred to an agency or end client if the contractor is retrospectively found within IR35 but defaults on payment?

In that case won't this put a lot of pressure to needlessly force lots of new contracts into IR35 by agents/clients trying to avoid this risk?

No, my understanding is that the liability you're talking about applies to brollies and the SDC test. There is a transfer of debt provision to the director(s) of an intermediary where T&S has been wrongly claimed because a contract is found to be under IR35 (EIM81050), but it isn't broader than that. Essentially, we're in a holding pattern until IR35 is reformed, at which point your fears may be realised. The direction of travel with these transfer of debt provisions is worrying. IR35 is a company liability and, until now, any transfer of debt has been difficult to justify (absent fraud/negligence).