Finance Bill 2019-20 draft legislation

[helen7]

Too many people seem to be clinging onto the idea that their skills are so unique and valuable that a big companies HR department will go out of their way to organise special working conditions and contracts for them.

No. Won't happen.

If you choose to only take 'outside 1r35' contracts; likelihood is that you have just reduced your client base by about 50-60%.

Hike your rate to compensate? Good luck - clients have strict rate cards; if you don't fit the range; you CV won't even reach the interviewers inbox; it will be rejected by the clerk in HR.

The pressure now should be on the payment of pension and holiday entitlements as part of contracts. The LTD company/dividends ship has now sailed folks.

[BrilloPad]

Too many people seem to be clinging onto the idea that their skills are so unique and valuable that a big companies HR department will go out of their way to organise special working conditions and contracts for them.

No. Won't happen.

If you choose to only take 'outside 1r35' contracts; likelihood is that you have just reduced your client base by about 50-60%.

Hike your rate to compensate? Good luck - clients have strict rate cards; if you don't fit the range; you CV won't even reach the interviewers inbox; it will be rejected by the clerk in HR.

The pressure now should be on the payment of pension and holiday entitlements as part of contracts. The LTD company/dividends ship has now sailed folks.

Hello harry

[JohntheBike]

Too many people seem to be clinging onto the idea that their skills are so unique and valuable that a big companies HR department will go out of their way to organise special working conditions and contracts for them.

No. Won't happen.

If you choose to only take 'outside 1r35' contracts; likelihood is that you have just reduced your client base by about 50-60%.

Hike your rate to compensate? Good luck - clients have strict rate cards; if you don't fit the range; you CV won't even reach the interviewers inbox; it will be rejected by the clerk in HR.

The pressure now should be on the payment of pension and holiday entitlements as part of contracts. The LTD company/dividends ship has now sailed folks.

well, I've been sort of saying this for some time, but I've been treated as a pariah by some for saying so.

"no employee taxes without employee benefits" must now be the over riding mantra

[WordIsBond]

...HR department...

Some people know the decision makers and agree a project with the end user, who then goes to Procurement, not HR.

I'm not an employee, and HR barely knows any other model. I'm a service provider. If a prospective client wants me to interview with HR it's over. I'm always planning on someone besides me doing at least some of the work. There's always something you can delegate.

[webberg]

Some interesting thoughts above which in my mind at least do not always quite appreciate that what we are seeing is a revolution, not an evolution.

There still seems to be a view that an external firm of adviser can present a "solution" for many scenarios (presumably meaning keeping the role outside IR35). I think this is a false premise.

Firstly, the line of cases we're seeing come to FTT - win or lose - are showing the same pattern. Determine what the job is and how it's done by whom and under what terms and from that invent a contract that fits it. If that contract looks like an employment contract, then it's inside IR35.

A solution that starts with that contract and does not audit your actions and if necessary correct what you are doing day to day, is going to fail to keep you outside IR35.

There is also a falsehood in linking employment for tax purposes and for employment law purposes. There is for sure a correlation in that many of the determining factors are decided on similar or the same terms. However an inside IR35 role for tax purposes DOES NOT mean you are an employee for tax purposes. Conversely, being held to be an employee for the purposes of employment law does NOT make you liable for tax as though you are.

And be clear. Being inside IR35 means for tax purposes that you pay the same amount of tax as an employee but DOES NOT confer any employment benefits.

It is legally acceptable to be not an employee for employment law, but to be taxed as though you are. The fiction created in the tax legislation is a stand alone position and is utterly independent of any position created for other purposes.

What does this mean?

In my view, if you are held to be inside IR35 and paying the same tax rate as an employee, you do NOT have the comfort of being able to claim the same benefits as an employee.

HMRC has been at huge pains to separate the

[WordIsBond]

"no employee taxes without employee benefits" must now be the over riding mantra

I think you are right on this point -- I think it is the only way for most to salvage this thing. That's how it should be played in the press, it is something that the man on the street can understand and say, 'That's not fair.' It's simple, it is simple fairness. HMRC doesn't care, but there are politicians who will.

And if contractors can win that battle, it will also help the ones who don't want employee benefits, because it will give clients an incentive to drop the blanket approach of declaring everyone inside IR35. They can then decide, full employment rights or adjust working practices and contracts to be outside. Some will decide one way, some another, but you'll have more outside roles if employment rights are tied to tax status.

In the past, it wasn't practical to tie the two because the contractor's tax status was not the client's business. Now that the client makes that determination, employment rights (in any fair system) should follow that decision.

edit: I'm still willing to consider you a pariah, however, so you can continue to feel martyred. I'm a nice guy that way.

[Barry Badrinath]

Free IR35 test here that I took last night to either provide some comfort or confirm your worst fears....
Home - IR35 Testing
It's pretty comprehensive in it's questions, and as I suspected (as a fairly generic Lead BA / PM), I am redder than the reddiest red you ever did see

[WordIsBond]

In my view, if you are held to be inside IR35 and paying the same tax rate as an employee, you do NOT have the comfort of being able to claim the same benefits as an employee.

That is not just 'your view', it is manifestly the legal position as things stand.

It is also, in terms of both justice and politics, the weak link in HMRC's development of Gordon Brown's abomination. 'The company I'm contracting for decided I have to pay tax as an employee but won't give me holiday pay, sick pay, paternity pay, notice when they terminate the position, etc.'

Go tell that story in the pub and see how your mates respond. Tell it in the press and sentiment can turn on this pretty quickly. The disconnect between tax and employee rights is indeed current law but it is unjust. Contractors, with a few exceptions, have not pursued this line because they didn't want either the employee tax or the employee rights. HMRC have taken advantage of that, but I think they've now forced contractors to attack this weak point.

[matzie]

Free IR35 test here that I took last night to either provide some comfort or confirm your worst fears....
Home - IR35 Testing
It's pretty comprehensive in it's questions, and as I suspected (as a fairly generic Lead BA / PM), I am redder than the reddiest red you ever did see

I quite liked that test, and it did seem thorough. And I liked its result for me, which was never in doubt - but note that although it's free, the 'pass' result leads to an attempt to sell a certificate for £60 and other assurance services. Might be appropriate for some people.

[JohntheBike]

That is not just 'your view', it is manifestly the legal position as things stand.

It is also, in terms of both justice and politics, the weak link in HMRC's development of Gordon Brown's abomination. 'The company I'm contracting for decided I have to pay tax as an employee but won't give me holiday pay, sick pay, paternity pay, notice when they terminate the position, etc.'

Go tell that story in the pub and see how your mates respond. Tell it in the press and sentiment can turn on this pretty quickly. The disconnect between tax and employee rights is indeed current law but it is unjust. Contractors, with a few exceptions, have not pursued this line because they didn't want either the employee tax or the employee rights. HMRC have taken advantage of that, but I think they've now forced contractors to attack this weak point.

let me re-iterate,


there is no case law where an individual has taken an employee for tax purposes judgement in the FTT to the ET, let alone receive a different judgement. To suggest otherwise is damaging our position. The question has to be asked, what are the differences in how both courts determine employment? If we understood this, then perhaps we'd have a better chance of mounting a successful campaign to neutralise IR35. So what factors does one court consider that the other doesn't?

the mantra "no employee taxes without employee benefits" must surely ring true in the wider community and we must press for this. Matthew Taylor recommended this, so there is some political weight to the argument.