Insurance to employers is not really what is needed - it's insurance to fee payers, i.e. those closest to the contractor. In the event that the decision on IR35 is "wrong" and more tax is due, they are HMRC's first port of call.
True, they will seek to lay off said risk to end clients (not very much) and individuals (almost all of it) but that is where the trail starts.
In effect if an individual is investigated and found to have avoided tax, then the fee payer pays and has to chase the individual. In effect therefore, doing HMRC's debt collection for them.
I would not be at all surprised to see fee payers being set up as £1 companies, sending all their income as a royalty to an offshore base and when HMRC come knocking, it's thank you and good night, leaving individual and end client exposed.
Is that too cynical?
True, they will seek to lay off said risk to end clients (not very much) and individuals (almost all of it) but that is where the trail starts.
In effect if an individual is investigated and found to have avoided tax, then the fee payer pays and has to chase the individual. In effect therefore, doing HMRC's debt collection for them.
I would not be at all surprised to see fee payers being set up as £1 companies, sending all their income as a royalty to an offshore base and when HMRC come knocking, it's thank you and good night, leaving individual and end client exposed.
Is that too cynical?
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