The Official 2018 Budget DOOM thread

[ChimpMaster]

HMT briefing here

https://assets.publishing.service.go...4/IR35_web.pdf

Interesting statement -

"HMRC will not carry out targeted campaigns into previous years when individuals start paying
employment taxes under IR35 for the first time following the reform and businesses’ decisions
about whether their workers are within the rules will not automatically trigger an enquiry into
earlier years"

"Promise. Look, no fingers crossed."

"will not automatically trigger an enquiry" - that's the get-out clause right there. HMRC will use a "computer says no" argument but will then manually trigger an investigation, which they can do up to 6 years after your tax return was submitted.

[WordIsBond]

"will not automatically trigger an enquiry" - that's the get-out clause right there. HMRC will use a "computer says no" argument but will then manually trigger an investigation, which they can do up to 6 years after your tax return was submitted.

They might do that and you are right about the get-out clause.

But they are probably well-tired of IR35 cases which are slow and painful to prosecute and they often lose. The whole point of all this is to reach the point where they don't have to do it any longer, where clients basically enforce it for them.

So they probably won't go after a lot of historical cases. Not worth the hassle. The easy way for them to rake in a lot more money is to focus on getting as many clients as possible to make as many inside determinations as they can. They really don't care that much about individual contractors, when the tax may not even be collectible. The new target of IR35 investigations is the clients, who won't close their company and WILL have company funds to pay when Hector comes calling.

[WordIsBond]

HMRC can gather all they like. Any liability is clearly the clients so not my concern.

For your current and historical contracts, sure.

But HMRC will find some PS body that has "too many" outside determinations, run an investigation, and go after them. If they win, and maybe even if they don't, it will scare everyone else. And at least some of those outside contracts that you are seeing are going to disappear.

[WordIsBond]

They (clients) will include tax warranties for you to be liable (bypassing corporate veil)

Probably not enforceable, particularly re: employer NI.

[TestMangler]

Haven't really looked through it, but can anyone tell me if the 'party of small business' has put smiles on all your little small business contractor faces ?

[northernladuk]

Haven't really looked through it, but can anyone tell me if the 'party of small business' has put smiles on all your little small business contractor faces ?

**** off.

[jamesbrown]

They might do that and you are right about the get-out clause.

But they are probably well-tired of IR35 cases which are slow and painful to prosecute and they often lose. The whole point of all this is to reach the point where they don't have to do it any longer, where clients basically enforce it for them.

So they probably won't go after a lot of historical cases. Not worth the hassle. The easy way for them to rake in a lot more money is to focus on getting as many clients as possible to make as many inside determinations as they can. They really don't care that much about individual contractors, when the tax may not even be collectible. The new target of IR35 investigations is the clients, who won't close their company and WILL have company funds to pay when Hector comes calling.

It's going to be worth the hassle for large organisations with many contractors who miraculously see a change in status on 6 April, 2020. Basically, this is what they're aiming for going forward (large groups of contractors with similar working practices), but with the added bonus of having a determination by the client that says, "I smell, look at me".

[ChimpMaster]

They might do that and you are right about the get-out clause.

But they are probably well-tired of IR35 cases which are slow and painful to prosecute and they often lose. The whole point of all this is to reach the point where they don't have to do it any longer, where clients basically enforce it for them.

So they probably won't go after a lot of historical cases. Not worth the hassle. The easy way for them to rake in a lot more money is to focus on getting as many clients as possible to make as many inside determinations as they can. They really don't care that much about individual contractors, when the tax may not even be collectible. The new target of IR35 investigations is the clients, who won't close their company and WILL have company funds to pay when Hector comes calling.

I agree, the big targets will be the ones that have a lot of blanket out-of-IR35 contracts.

But if a contractor has been with a client for years then it's an obvious target.

Heck, in the Public Sector the news is that HMRC are reviewing status' of contractors even when the PS client says they are out of IR35. There's no end to the tyranny, so it's best to prepare for the worst: if your client says you're within IR35 (and there's no fighting it) then quit the contract and find another one.

[DimPrawn]

Haven't really looked through it, but can anyone tell me if the 'party of small business' has put smiles on all your little small business contractor faces ?

Who you calling a small business? Me and Rodder's are going to be IT millionaire's next year!

[CatOnMat]

Yes sure, more take-home equals more tax but the increase in take-home without having to pay higher rate tax is still a winner to me. It's more money in my pocket that I can actually use at the end of the day.

And I suppose that when when you do use it the govt will still be taking a chunk via VAT/fuel duty/other purchase taxes where applicable - but there's an element of choice there at least...