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Support Monkey
28th February 2017, 19:14
Just received a letter from the NHS trust I have previous contracted directly for, looks like that's the end of that then :ohwell

I can only assume many other NHS trusts will follow.

Basically says that any new third party or short term engagement made after April the 5th will not be engaged outside of IR35 and deductions will be made for associated Employment taxes and NI via payroll or umbrella arrangment.

This applies to both healthcare workers and non-medical agency workers.

eek
28th February 2017, 19:48
Just received a letter from the NHS trust I have previous contracted directly for, looks like that's the end of that then :ohwell

I can only assume many other NHS trusts will follow.

Basically says that any new third party or short term engagement made after April the 5th will not be engaged outside of IR35 and deductions will be made for associated Employment taxes and NI via payroll or umbrella arrangment.

This applies to both healthcare workers and non-medical agency workers.

They are going to have fun filling gaps come April....

Support Monkey
28th February 2017, 20:04
They are going to have fun filling gaps come April....

My thoughts exactly, although not difficult for non medical to go private but medical staff probably won't have that choice.

Is it going to push wages up as people try to cover the loss?

Lurker101
28th February 2017, 20:06
Just received a letter from the NHS trust I have previous contracted directly for, looks like that's the end of that then :ohwell

I can only assume many other NHS trusts will follow.

Basically says that any new third party or short term engagement made after April the 5th will not be engaged outside of IR35 and deductions will be made for associated Employment taxes and NI via payroll or umbrella arrangment.

This applies to both healthcare workers and non-medical agency workers.

Interesting. My current NHS client has started to address this today they are looking to engage with each if it's interim's individually. They have also stated they can process invoices received before the 5th April by the 5th which is a nice touch. How it actually pans out is another matter.

NHS1979
1st March 2017, 06:32
I think the vast majority of NHS organisations will do this. My own is doing case-by-case assessment, but not heard a peep from HR dept for weeks - I can only imagine they think they will do assessment sometime this month or later (unaware that people are leaving anyway). The actual end client continues offering me all sorts of options inside and outside - I keep saying no I have to leave.

Annoyingly there are contractors staying where I am, all in directorship positions, line managing staff, one has been there for 2 years. Makes me look extreme for leaving. I hope they get caught.

SueEllen
1st March 2017, 07:59
I think the vast majority of NHS organisations will do this. My own is doing case-by-case assessment, but not heard a peep from HR dept for weeks - I can only imagine they think they will do assessment sometime this month or later (unaware that people are leaving anyway). The actual end client continues offering me all sorts of options inside and outside - I keep saying no I have to leave.

Annoyingly there are contractors staying where I am, all in directorship positions, line managing staff, one has been there for 2 years. Makes me look extreme for leaving. I hope they get caught.

They are already caught.

cojak
1st March 2017, 08:03
Annoyingly there are contractors staying where I am, all in directorship positions, line managing staff, one has been there for 2 years. Makes me look extreme for leaving. I hope they get caught.

Don't forget to point them to this site before you go.

We all like a good laugh... :happy

notahappybunny
1st March 2017, 08:51
My PSB (Trust) are not interested in determination tools / QDOS etc.......ruled my interim contract inside IR35 and no attempt to retain or consult with me whatsoever. Line manager fully understands my reasons for leaving but is absolutely frantic as they have already tried to recruit a suitably skilled / experienced permanent employee (unsuccessfully twice) and actually wanted to extend my contract.

Agreed to stay until 30th (monies paid before the 5th agreed )but even if they do find a suitable candidate (position not advertised at the moment) it is likely to be a 6 month process to get someone in place.

Seems such a shame :frown

cojak
1st March 2017, 08:53
My PSB (Trust) are not interested in determination tools / QDOS etc.......ruled my interim contract inside IR35 and no attempt to retain or consult with me whatsoever. Line manager fully understands my reasons for leaving but is absolutely frantic as they have already tried to recruit a suitably skilled / experienced permanent employee (unsuccessfully twice) and actually wanted to extend my contract.

Agreed to stay until 30th (monies paid before the 5th agreed )but even if they do find a suitable candidate (position not advertised at the moment) it is likely to be a 6 month process to get someone in place.

Seems such a shame :frown
A shame yes, but you haven't caused this problem - you're just reacting to it.

northernladuk
1st March 2017, 09:13
A shame yes, but you haven't caused this problem - you're just reacting to it.

You could argue there are plenty of people sat around the previous poster that have caused this.

notahappybunny
1st March 2017, 09:24
You could argue there are plenty of people sat around the previous poster that have caused this.

Part way through some major restructuring of a very specialist area. I am not comfortable leaving them in the lurch as there is only one of me in the Trust and have never walked away from unfinished work before....but then again I am supposed to be retired so the OH may be pleased :wink

LondonManc
1st March 2017, 09:59
Part way through some major restructuring of a very specialist area. I am not comfortable leaving them in the lurch as there is only one of me in the Trust and have never walked away from unfinished work before....but then again I am supposed to be retired so the OH may be pleased :wink

You've never had a 45% pay cut forced on you before, with a bonus retrograb thrown in for free.
They've brought this on themselves through trying to apply something to an archaic tax structure to "fix" a modern problem.

Support Monkey
1st March 2017, 10:28
My PSB (Trust) are not interested in determination tools / QDOS etc.......ruled my interim contract inside IR35 and no attempt to retain or consult with me whatsoever. Line manager fully understands my reasons for leaving but is absolutely frantic as they have already tried to recruit a suitably skilled / experienced permanent employee (unsuccessfully twice) and actually wanted to extend my contract.

Agreed to stay until 30th (monies paid before the 5th agreed )but even if they do find a suitable candidate (position not advertised at the moment) it is likely to be a 6 month process to get someone in place.
Seems such a shame :frown

My particular letter came direct from the trusts contracts HR person, and there is no mention of looking into individual cases, it's a blanket "your now inside IR35"

I think the pretend contractors will just suck it up and any genuine contractor is probably going to walk to the Private sector

b r
1st March 2017, 10:29
As said previously, don't get ill over the Easter weekend...:sick

Andy Hallett
1st March 2017, 11:32
A few blanket responses received, but not many - the majority are accepting review of individual cases.

seeourbee
1st March 2017, 11:58
A lot of my contacts in NHS are just accepting it. Which is fine in my opinion as they sound like employees anyway. And at that rate HMRC may be happy enough with that small effortless win and not relentlessly pursue the smaller remaining portion.

Time will tell...

Support Monkey
1st March 2017, 12:00
A few blanket responses received, but not many - the majority are accepting review of individual cases.

Well maybe but I think when your dealing with this on-mass come April I can't see many trusts-PS HR departments spending time using tools and assessing individual contracts especially considering the amount of contractors we're talking about.

LondonManc
1st March 2017, 12:02
A lot of my contacts in NHS are just accepting it. Which is fine in my opinion as they sound like employees anyway. And at that rate HMRC may be happy enough with that small effortless win and not relentlessly pursue the smaller remaining portion.

Time will tell...

They'll judge what is effortless - I'd suggest that moving to an umbrella would be safer to avoid a retrograb; if you're operating a limited company and outside, stay in the same role and then suddenly you're inside, you're a sitting duck for the taxman to say, okay, what's changed.

From what I've read, the benefits of operating a limited if you're purely running inside IR35 contracts are minimal; you're comparing insurance and accountancy costs with not being hit for umbrella fees and the apprentice levy. Small beans compared to the major PAYE hit that you're taking.

Outside & limited at the moment? If you're deemed inside and staying put, going umbrella seems safer imho, but I could be wrong.

Manwell Pablo
1st March 2017, 16:30
I mean this might sound naive here, but why on earth don't they just adjust the contracts to comply with outside IR35 regulations......I would of thought that'd be relatively simple. Then if HMRC want to investigate they'd have to physically investigate you which lets face it is not something they make a habit of doing that often!

LondonManc
1st March 2017, 16:35
I mean this might sound naive here, but why on earth don't they just adjust the contracts to comply with outside IR35 regulations......I would of thought that'd be relatively simple. Then if HMRC want to investigate they'd have to physically investigate you which lets face it is not something they make a habit of doing that often!

So you're advocating tax evasion?

northernladuk
1st March 2017, 16:36
I mean this might sound naive here, but why on earth don't they just adjust the contracts to comply with outside IR35 regulations......I would of thought that'd be relatively simple. Then if HMRC want to investigate they'd have to physically investigate you which lets face it is not something they make a habit of doing that often!

Because working practices trump the contract. If they alter the contract and get caught with incorrect WP someone is on the hook for it so it's about risk aversion levels.

Manwell Pablo
1st March 2017, 16:41
Because working practices trump the contract. If they alter the contract and get caught with incorrect WP someone is on the hook for it so it's about risk aversion levels.

:tired

Their looking into mine at the moment and letting me know, I did post awhile I but still being moderated, fortunately contract ends just before all this kicks off so I have the cut and run option. They've suggested going over to Umbrella before the changes, that just looks like a big hey HMRC look at this sign to me, also possibly ending contract and them opening a new role up a few weeks later, seems more feasible, not really sure Umbrella all the way out here is for me though.

LondonManc
1st March 2017, 16:46
:tired

Their looking into mine at the moment and letting me know, I did post awhile I but still being moderated, fortunately contract ends just before all this kicks off so I have the cut and run option. They've suggested going over to Umbrella before the changes, that just looks like a big hey HMRC look at this sign to me, also possibly ending contract and them opening a new role up a few weeks later, seems more feasible, not really sure Umbrella all the way out here is for me though.

I'd stay with limited until you finish your current outside one, then clean break and, making sure that your new contract is worded much more inside go umbrella. Having the same word for word contract as when you were outside would look bad.

Hand on heart, do you feel that your current contract should be inside, when taken with the working practices?

Manwell Pablo
1st March 2017, 17:03
I'd stay with limited until you finish your current outside one, then clean break and, making sure that your new contract is worded much more inside go umbrella. Having the same word for word contract as when you were outside would look bad.

Hand on heart, do you feel that your current contract should be inside, when taken with the working practices?

That's what I am planning on doing. It has to be a clean break I think, I'd avoid scrutiny altogether then........Unless drastic changes are made to the current contract and it actually IS outside and covers me. I'd best get some letterheads and business cards printed up in that case I guess in case they come hunting :happy!

Bit of a grey area to be honest, I work on a project, I have skills no one else here has, I can work from home if I want, I have temporary ID not company ID etc etc. But at the same time they should really employ a perm to do SOME of the work I do, in fact they are going through recruitment for that right now.

Every tool and questionnaire at the moment seems ridiculously harsh and being outside next to impossible, to the extent where i just took one and tried my best to get an outside outcome (lying and putting in what I though would fall outside) and still borderline fell inside. So bearing that in mind, I'd be in I guess!

As I've said it's a massive shame they really need me for a few more months and I don't mind it here. But the end was in sight anyway so for me it's not much of a big deal.....its going to destroy them though unless I get someone trained up to do parts of my job that are more perm workers jobs, even then project is going to take a hit and they will have no one to produce anything other than routine reports. Such a waste.


EDIT: "Nervous Newbie" aint that the truth haha

WordIsBond
1st March 2017, 18:12
Bit of a grey area to be honest, I work on a project, I have skills no one else here has, I can work from home if I want, I have temporary ID not company ID etc etc. But at the same time they should really employ a perm to do SOME of the work I do, in fact they are going through recruitment for that right now.

Sounds pretty good to me. The WFH "if I want" is very helpful, so is "skills no one else here has," that means they can't point to an employee who is doing the same thing. Whether they "should really employ a perm" doesn't seem like a big issue to me, if they haven't they haven't. As long as it is defined as part of a project it doesn't seem like an issue.

Perhaps you could sign two contracts with them, one for the project and one for perm stuff. The project is outside, the perm stuff is inside. I had two separate contracts with one of my clients for a while. Paid my salary and pension contributions out of the Inside IR35 contract.

Manwell Pablo
1st March 2017, 19:18
Sounds pretty good to me. The WFH "if I want" is very helpful, so is "skills no one else here has," that means they can't point to an employee who is doing the same thing. Whether they "should really employ a perm" doesn't seem like a big issue to me, if they hyaven't they haven't. As long as it is defined as part of a project it doesn't seem like an issue.

Perhaps you could sign two contracts with them, one for the project and one for perm stuff. The project is outside, the perm stuff is inside. I had two separate contracts with one of my clients for a while. Paid my salary and pension contributions out of the Inside IR35 contract.

Well I Thought that. But as I say every questionnaire I fill in says inside, it does then offer to sell me a recovery package for thirty quid so obviously sceptical not the word :happy but still.....I guess all will become clearer when the official one is released.

It's only 9 months I guess. Most of my rainy day money was earnt in a previous contract which I'm very confident would be outside unless they are being completely unreasonable, and the company I worked for.....do you know it's just come to me they wouldn't they wouldn't even be PS technically, and they have been liquidated.

Interesting suggestion might look into that thank you.

Andy Hallett
1st March 2017, 20:06
I hope all these NHS organisations that are declaring their direct contractors inside have budgeted for the additional 14.3% Employers NI and Apprenticeship Levy, most of the ones I have been speaking to certainly haven't!

LondonManc
1st March 2017, 20:10
I hope all these NHS organisations that are declaring their direct contractors inside have budgeted for the additional 14.3% Employers NI and Apprenticeship Levy, most of the ones I have been speaking to certainly haven't!

So, this £440m saving will come from a circular reference of the employers NI and apprenticeship levy too?

This is hilarious.

Manwell Pablo
1st March 2017, 20:27
I hope all these NHS organisations that are declaring their direct contractors inside have budgeted for the additional 14.3% Employers NI and Apprenticeship Levy, most of the ones I have been speaking to certainly haven't!

Their ill preparation for this is quite shocking to be honest.

Says a lot about the state of the NHS and it's got nothing to do with the people HMRC have decided to victimise.

northernladuk
1st March 2017, 21:09
Says a lot about the state of the NHS and it's got nothing to do with the people HMRC have decided to victimise.

You know this doesn't just affect the NHS right?

LondonManc
1st March 2017, 21:12
Their ill preparation for this is quite shocking to be honest.

Says a lot about the state of the NHS and it's got nothing to do with the people HMRC have decided to victimise.

This is more about HMRC being skint and being unable to force companies to take permies on and get them paying business NICs. If there was some sort of contingent work levy (for contractors and consultants) imposed on businesses, then we wouldn't be feeling the full force of HMRC's tax grab hammer. That said, businesses would run with a smaller contingent workforce rather than take on the same number.

Manwell Pablo
1st March 2017, 21:33
You know this doesn't just affect the NHS right?

Yes thanks, you've read the title of the thread right?

Barrygbr
2nd March 2017, 15:46
Just a thought.

If any of you voted for this rotten Tory government, thanks a lot (or should that be thanks for nothing). It's Tory government paranoia that has resulted in all this mess and aggravation.

My case specifics re working as a contractor outside IR35 was as follows. I worked as a locum for the NHS in mental health care. I used a company called IQ Contracts who used a variant of umbrella in which I received a small weekly wage (equivalent to national minimum wage) and the bulk of my money as a loan. This scheme was supposed to be backed by insurance in the event of a HMRC investigation. I used IQ for just short of 4 years and then changed to Bestpay for the final 10 months of my contracting period.

In the past few months I have been contacted by HMRC who informed me that the loan was classed as taxable and that I needed to provide self assessment for 2012-3, 13-4, 14-5 and 15-6. I have tried to contact IQ who have now shut up shop and are not contactable. They have provided details of two companies (dependent on year) who can help. I have contacted one for 2012-3 and am awaiting a response. The company who are supposed to be dealing with the other 3 years do not seem to exist. consequently, I am not able to submit as I am not able to access the info I need. I may have had this but being classed as employed I have not retained it. As a consequence I am now getting fines from HMRC and they will soon begin to charge interest at some inflated rate for non compliance. And until somebody provides me with the info I need I cannot submit. I have spoken to HMRC about this and to be candid, the could not give a flying toss. Now if I was Amazon, Starbucks, Google.......

Its a bit of a double whammy really, reduce contracting by offering more employed positions, cap remuneration for people still working as contractors and whack them over the head for past contracts (in some cases backdated 6 years which is as far as they can go due to statute of limitations).

All rather worrying really and I can see where this all leads. Consequently, I have ceased contracting period and am now looking to change my career and move overseas. I will not work for the crap money offered by the NHS (even as a contractor) if I then have to pay class 2 and NI. I will also not offer my developed and specialised skills for the new capped rates.

I am however very dismayed by the number of contractors who are taking all this crap, accepting wage capped roles as employees or accepting contractor positions at the new pay caped rates. Seems to me if we all stood up and said no, refusing to accept the crap (as above) that HMG and HMRC are lobbing at us, then we may just have a chance of defeating the new regime. As their are a significant number prepared to roll over, submitting and embracing the new regime then the rest of us have no chance whatsoever - and you know what that means!

Andy Hallett
2nd March 2017, 20:39
Just a thought.

If any of you voted for this rotten Tory government, thanks a lot (or should that be thanks for nothing). It's Tory government paranoia that has resulted in all this mess and aggravation.

My case specifics re working as a contractor outside IR35 was as follows. I worked as a locum for the NHS in mental health care. I used a company called IQ Contracts who used a variant of umbrella in which I received a small weekly wage (equivalent to national minimum wage) and the bulk of my money as a loan. This scheme was supposed to be backed by insurance in the event of a HMRC investigation. I used IQ for just short of 4 years and then changed to Bestpay for the final 10 months of my contracting period.

In the past few months I have been contacted by HMRC who informed me that the loan was classed as taxable and that I needed to provide self assessment for 2012-3, 13-4, 14-5 and 15-6. I have tried to contact IQ who have now shut up shop and are not contactable. They have provided details of two companies (dependent on year) who can help. I have contacted one for 2012-3 and am awaiting a response. The company who are supposed to be dealing with the other 3 years do not seem to exist. consequently, I am not able to submit as I am not able to access the info I need. I may have had this but being classed as employed I have not retained it. As a consequence I am now getting fines from HMRC and they will soon begin to charge interest at some inflated rate for non compliance. And until somebody provides me with the info I need I cannot submit. I have spoken to HMRC about this and to be candid, the could not give a flying toss. Now if I was Amazon, Starbucks, Google.......

Its a bit of a double whammy really, reduce contracting by offering more employed positions, cap remuneration for people still working as contractors and whack them over the head for past contracts (in some cases backdated 6 years which is as far as they can go due to statute of limitations).

All rather worrying really and I can see where this all leads. Consequently, I have ceased contracting period and am now looking to change my career and move overseas. I will not work for the crap money offered by the NHS (even as a contractor) if I then have to pay class 2 and NI. I will also not offer my developed and specialised skills for the new capped rates.

I am however very dismayed by the number of contractors who are taking all this crap, accepting wage capped roles as employees or accepting contractor positions at the new pay caped rates. Seems to me if we all stood up and said no, refusing to accept the crap (as above) that HMG and HMRC are lobbing at us, then we may just have a chance of defeating the new regime. As their are a significant number prepared to roll over, submitting and embracing the new regime then the rest of us have no chance whatsoever - and you know what that means!

I am sorry to burst the bubble, but those type of schemes were always a risk and the old adage of "if it's too good to be true" applies. You took a gamble, you lost.

One assumes taxpayer money funded your training to become a mental health expert, but you were not happy to pay back into the pot.

The business I work for has been built on providing genuine entrepreneurs who have developed specialist skills into scarce markets, however you are exactly the sort of reason that this legislation is used as a blunt stick to beat the many.

All the best with the new career.

Andy Hallett
2nd March 2017, 20:41
locum

a person who stands in temporarily for someone else of the same profession, especially a cleric or doctor.

eek
2nd March 2017, 20:56
Through greed I joined a loan scheme and now wish to leave the country rather than pay back what I owed even though the NHS paid for my training.

Sorry to be blunt but I've paraphrased your post into a more readable version.

While there are a few people on here who will agree with you personally its you and people like you who have created this mess that is partly the reason the public sector changes were unavoidable....

DotasScandal
2nd March 2017, 22:03
I am sorry to burst the bubble, but those type of schemes were always a risk and the old adage of "if it's too good to be true" applies. You took a gamble, you lost.

One assumes taxpayer money funded your training to become a mental health expert, but you were not happy to pay back into the pot.

The business I work for has been built on providing genuine entrepreneurs who have developed specialist skills into scarce markets, however you are exactly the sort of reason that this legislation is used as a blunt stick to beat the many.

All the best with the new career.

Judgemental, much?

You really don't do yourself any favors with this one, Andy.

eek
2nd March 2017, 22:11
Judgemental, much?

You really don't do yourself any favors with this one, Andy.

It's swings and roundabouts. While some posters may dislike his response others will agree with him...

Andy Hallett
2nd March 2017, 22:12
Judgemental, much?

You really don't do yourself any favors with this one, Andy.

It's my personal opinion. Like everything in life, nothing is black and white - this is just too grey for my liking. His argument is hypocritical in the extreme.

There were hundreds of schemes like this around at the time. I refused to trade with them, often at our companies detriment, because it was clear where it would end up.

bobspud
2nd March 2017, 22:22
I am sorry to burst the bubble, but those type of schemes were always a risk and the old adage of "if it's too good to be true" applies. You took a gamble, you lost.

One assumes taxpayer money funded your training to become a mental health expert, but you were not happy to pay back into the pot.

The business I work for has been built on providing genuine entrepreneurs who have developed specialist skills into scarce markets, however you are exactly the sort of reason that this legislation is used as a blunt stick to beat the many.

All the best with the new career.

Hang on...

I seem to remember a fair few of your entrepreneurial collegues were stealing vast sums of margin on health sector locum staff...

Maybe if those pigs were not so far in the troff there would have been enough money to share for the front line staff and paying full taxes would have been easier to suffer for them.

I get the hindsight point about umbrella company schemes but many of the ones taken in to them never wanted to be using agency's in the first place.

I value the work you have put in over the past months. That was an un needed stone to chuck.

Andy Hallett
2nd March 2017, 22:34
Hang on...

I seem to remember a fair few of your entrepreneurial collegues were stealing vast sums of margin on health sector locum staff...

Maybe if those pigs were not so far in the troff there would have been enough money to share for the front line staff and paying full taxes would have been easier to suffer for them.

I get the hindsight point about umbrella company schemes but many of the ones taken in to them never wanted to be using agency's in the first place.

I value the work you have put in over the past months. That was an un needed stone to chuck.

That's a fair and balanced reply.

I've been doing this for nearly 20 years now and it's generally been a healthy eco-system. Professional contractors get legitimate tax benefits because they take risk and don't have employment rights. Agents who have created the marketplace between supply and demand.

What has also been evident is there are a lot of individuals and companies that seek to take advantage of the perfectly reasonable scenario above in a very aggressive fashion. Teachers paid in Sark and warehouse worker PSC's being just a few examples.

It is this extreme avoidance that gives our collective industry a bad name and then we all suffer with the blunt hammer blow.

My comment is not a general indictment on those who used the schemes. At the end of the day it is a commercial risk for each individual. The issue I had with the poster was their hypocritical sense of injustice.

b r
2nd March 2017, 22:44
It is this extreme avoidance that gives our collective industry a bad name and then we all suffer with the blunt hammer blow.

+1

Always someone out to screw the system.

DotasScandal
2nd March 2017, 22:56
+1
Always someone out to screw the system.

Of course, HMRC's sitting on their hands for 10+ years and letting the "extreme avoidance" schemes prosper beyond the promoters' wildest dreams has nothing to do with it...No, It's all the fault of the punter.
:facepalm:

I asked myself for a moment whether your post was second degree. Then I remembered I'm on CUK...

jamesbrown
3rd March 2017, 00:18
Professional contractors get legitimate tax benefits because they take risk and don't have employment rights.

I think it's worth unpacking that statement, because it's at the root of the argument. HMRC would argue that they aren't party to any explicit trade-off between employment rights and the amount of tax due. Instead, the parties to the contract engage in an explicit trade-off between employment rights and remuneration. Separately, for macroeconomic and other reasons, HMG may want to encourage particular forms of working, for which a "legitimate tax benefit" may be intended. Our problem is that such an intention has never been properly codified, and it's now being questioned. Most of the recent reports on this (IFS, Resolution Foundation etc.) have correctly identified the nub of the issue by posing the question: "what, if any, tax benefits does HMG intend for flexible forms of working?". The answer coming back is apparently "none" or, at least, "very few", which is why they not only intend to render equivalent different forms of income/working for tax purposes but they also reject the argument that any re-balancing should be coupled with an increase in employment rights, because they aren't party to that trade-off. That trade-off is between the contractor and the client and is reflected in the contract remuneration.

In other words, I think any criticism of HMG needs to be more nuanced than "no employment taxation without employment rights", and this is partly why I can't muster too much excitement. If they explicitly decide there shouldn't be any "tax benefit" for flexible working, it's their prerogative. However, in the PS, it's completely different, because HMG is not only acting in their general capacity of managing the economy, but in their specific capacity as client, where the trade-off between (lack of) employment rights and remuneration occurs. They shouldn't be allowed to get away with recruiting contractors to do permie work, and most certainly not on permie rates. They should hire permies to do permie work and, failing that, they should offer rates that fully compensate for the lack of employment rights. In short, if they're going to demand employment for tax purposes, and they don't want employees, they'd better put their rates up substantially.

teapot418
3rd March 2017, 06:16
I think it's worth unpacking that statement, because it's at the root of the argument. HMRC would argue that they aren't party to any explicit trade-off between employment rights and the amount of tax due. Instead, the parties to the contract engage in an explicit trade-off between employment rights and remuneration. Separately, for macroeconomic and other reasons, HMG may want to encourage particular forms of working, for which a "legitimate tax benefit" may be intended. Our problem is that such an intention has never been properly codified, and it's now being questioned. Most of the recent reports on this (IFS, Resolution Foundation etc.) have correctly identified the nub of the issue by posing the question: "what, if any, tax benefits does HMG intend for flexible forms of working?". The answer coming back is apparently "none" or, at least, "very few", which is why they not only intend to render equivalent different forms of income/working for tax purposes but they also reject the argument that any re-balancing should be coupled with an increase in employment rights, because they aren't party to that trade-off. That trade-off is between the contractor and the client and is reflected in the contract remuneration.

In other words, I think any criticism of HMG needs to be more nuanced than "no employment taxation without employment rights", and this is partly why I can't muster too much excitement. If they explicitly decide there shouldn't be any "tax benefit" for flexible working, it's their prerogative. However, in the PS, it's completely different, because HMG is not only acting in their general capacity of managing the economy, but in their specific capacity as client, where the trade-off between (lack of) employment rights and remuneration occurs. They shouldn't be allowed to get away with recruiting contractors to do permie work, and most certainly not on permie rates. They should hire permies to do permie work and, failing that, they should offer rates that fully compensate for the lack of employment rights. In short, if they're going to demand employment for tax purposes, and they don't want employees, they'd better put their rates up substantially.

Not quite such a good sound-bite though :laugh

NHS1979
4th March 2017, 14:29
Having made my decision to leave the current outside-IR35 gig - with a plan to find something with new client/agency/role and probably inside-IR35 via an umbrella- I'm now getting more options come my way which I thought I'd share.

1) high likelihood current client will declare me outside IR35 to make me stay, + move me to a sister organisation if they have to.

2) offered a senior perm role elsewhere

I've number crunched no.2 to death and I just can't make it work without an income drop I would notice irl.

No.1 is making me pause though. Am I beating a hasty retreat to new pastures hastily? Given my paranoia about retro checks, would it be foolish to stay if they declare me still outside?

Also does the plan to slip inside via an umbrella make any sense if I can get an outside gig somewhere? Will it make any difference to the retro threat?

b r
4th March 2017, 14:37
high likelihood current client will declare me outside IR35 to make me stay, + move me to a sister organisation if they have to.

Where my OH is they've pretty much decided this too, can't imagine Hammond will be chuffed if a load of the PS do the same.

cojak
4th March 2017, 14:41
Having made my decision to leave the current outside-IR35 gig - with a plan to find something with new client/agency/role and probably inside-IR35 via an umbrella- I'm now getting more options come my way which I thought I'd share.

1) high likelihood current client will declare me outside IR35 to make me stay, + move me to a sister organisation if they have to.

2) offered a senior perm role elsewhere

I've number crunched no.2 to death and I just can't make it work without an income drop I would notice irl.

No.1 is making me pause though. Am I beating a hasty retreat to new pastures hastily? Given my paranoia about retro checks, would it be foolish to stay if they declare me still outside?

Also does the plan to slip inside via an umbrella make any sense if I can get an outside gig somewhere? Will it make any difference to the retro threat?

If these are new variables then you are right to re-consider, particularly with the ESS tool now public (although not stable).

But the other questions you pose still comes up with the usual "No idea - who knows?" answer and so falls back on your risk appetite.

teapot418
4th March 2017, 15:24
If the role is declared outside, you'd be daft to go brolly. I would also imagine the risk of investigation for previous contracts would be vastly reduced. There's no guarantees though!

gables
4th March 2017, 16:02
Having made my decision to leave the current outside-IR35 gig - with a plan to find something with new client/agency/role and probably inside-IR35 via an umbrella- I'm now getting more options come my way which I thought I'd share.

1) high likelihood current client will declare me outside IR35 to make me stay, + move me to a sister organisation if they have to.

2) offered a senior perm role elsewhere

I've number crunched no.2 to death and I just can't make it work without an income drop I would notice irl.

No.1 is making me pause though. Am I beating a hasty retreat to new pastures hastily? Given my paranoia about retro checks, would it be foolish to stay if they declare me still outside?

Also does the plan to slip inside via an umbrella make any sense if I can get an outside gig somewhere? Will it make any difference to the retro threat?

In terms of retro grab, the impression I'm getting from these boards is that it's a higher possibility if you're declared inside when previously 'outside' and nothing else has changed. In your case you're outside and still outside so the risk to you hasn't changed from that of HMRC investigating before this stuff, if that makes sense.

bobspud
4th March 2017, 20:44
In terms of retro grab, the impression I'm getting from these boards is that it's a higher possibility if you're declared inside when previously 'outside' and nothing else has changed. In your case you're outside and still outside so the risk to you hasn't changed from that of HMRC investigating before this stuff, if that makes sense.

From what I have seen the maturity of the people making the call is lacking to say the least.

So while one could think that retro grabs are likely: having now used the tool, got a stringent out result and gone through the process of compiling the supporting evidence. If HMRC would like to investigate should my department go the other way, I will be more likely to be able to prove I am right and they were wrong.

Of the questions I asked them the other week they couldn't answer any of them.

RonBW
4th March 2017, 21:55
1) high likelihood current client will declare me outside IR35 to make me stay, + move me to a sister organisation if they have to.

If the client is prepared to make that determination and put that in writing, then the liability would shift to either the agency (if they aren't lying) or the end client (if they are).

So on that basis, I would consider staying as long as the determination is in writing and confirmed by everyone in advance.

LondonManc
5th March 2017, 15:15
From what I have seen the maturity of the people making the call is lacking to say the least.

So while one could think that retro grabs are likely: having now used the tool, got a stringent out result and gone through the process of compiling the supporting evidence. If HMRC would like to investigate should my department go the other way, I will be more likely to be able to prove I am right and they were wrong.

Of the questions I asked them the other week they couldn't answer any of them.

I would expect that if you're out before and still out of IR35 in April, you'll be at the bottom of the list for investigation.

Andy Hallett
6th March 2017, 09:32
From the telegraph this morning:

"And last year Jim Mackey, who earns between £215,000 and £220,000 as head of another watchdog, NHS Improvement, spoke of how he believed there was “a door open” at the Treasury , saying the NHS needed to “get our case together” to get more funds."

More than 600 health quango chiefs on six figure salaries amid cash crisis (http://www.telegraph.co.uk/news/2017/03/05/600-health-quango-chiefs-six-figure-salaries-amid-cash-crisis/)

https://jumpshare.com/v/Et8z2DADOzCYGTJDFmHo