At the risk of asking a stupid question. Instead of IR35 why didn't HMRC simply say all contractors must pay a fixed proportion (e.g. at least a third) of turnover as salary?
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Why did HMRC go with IR35?
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Stupid question indeed. Define "contractor". Do you mean a legitimate small business (who would be disadvantaged by such a move), or a disguised employee (who would gain an advantage by such a move). -
Originally posted by Crossroads View PostStupid question indeed. Define "contractor". Do you mean a legitimate small business (who would be disadvantaged by such a move), or a disguised employee (who would gain an advantage by such a move).
I contend that IR35 is simply seen as 'over the top'. If it had been pitched more reasonably and clearly (e.g a third of turnover but feel free to insert something more reasonable and/or clear if you prefer) the greater body of contractors would've accepted it and the government would've had a bigger overall tax take with much less expense.Comment
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Originally posted by babason View PostPlease stick to the point. The issue of definition arises whichever system you use.
If the government and HMRC cannot distinguish the two they cannot write a law that will not be tested through the courts causing them to lose most of their cases.
Remember lots of MPs in the House of Commons are lawyers and most laws in this country, while they may be written for specific purposes can be used in different ways."You’re just a bad memory who doesn’t know when to go away" JRComment
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Originally posted by SueEllen View PostCrossroads has stuck to the point.
My question doesn't require definition of 'deemed employee', 'contractor' or 'small business'. For the sake of argument I am going with HMRC's definitions.
My question is why did they go for applying PAYE + NICs to 95% of turnover which was bound to provoke measures which ensure the actual tax take as a whole is only a tiny fraction of this.
Surely if they'd not been greedy and gone for say a third, there would have been a general reluctance maybe even irritation but on the whole it would have been paid and the tax take would have been higher for a lot less effort expended...Comment
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Originally posted by babason View PostNo he didn't and now neither have you.
My question doesn't require definition of 'deemed employee', 'contractor' or 'small business'. For the sake of argument I am going with HMRC's definitions.
My question is why did they go for applying PAYE + NICs to 95% of turnover which was bound to provoke measures which ensure the actual tax take as a whole is only a tiny fraction of this.
Surely if they'd not been greedy and gone for say a third, there would have been a general reluctance maybe even irritation but on the whole it would have been paid and the tax take would have been higher for a lot less effort expended...
How would we know!Comment
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Originally posted by babason View PostNo he didn't and now neither have you.
My question doesn't require definition of 'deemed employee', 'contractor' or 'small business'. For the sake of argument I am going with HMRC's definitions.
My question is why did they go for applying PAYE + NICs to 95% of turnover which was bound to provoke measures which ensure the actual tax take as a whole is only a tiny fraction of this.
Surely if they'd not been greedy and gone for say a third, there would have been a general reluctance maybe even irritation but on the whole it would have been paid and the tax take would have been higher for a lot less effort expended...
your question "At the risk of asking a stupid question. Instead of IR35 why didn't HMRC simply say all contractors must pay a fixed proportion (e.g. at least a third) of turnover as salary?"
can you define contractor please? either your own or hmrc definition.
I don't know any contractors - only small businesses.
Are you suggesting that every business should pay a fixed proportion of turnover as salary?Comment
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Originally posted by BrilloPad View Postok mr troll/hmrc mole
I don't know any contractors - only small businesses.
Are you suggesting that every business should pay a fixed proportion of turnover as salary?
I'm intrigued as to why HMRC went for such a large amount. If they'd gone for a more reasonable amount (say a third) the targeted small businesses would complain but would've paid, thereby increasing the overall tax take. It just seemed poor strategy on HMRC's part and I wondered if there was an explanation for it. However, it doesn't look like I'm gonna get one here as I am now a 'deemed troll'...Comment
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Originally posted by babason View PostPlease stick to the point. The issue of definition arises whichever system you use.
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"You’re just a bad memory who doesn’t know when to go away" JRComment
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