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Inside IR35 & I Want to Stay

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    Inside IR35 & I Want to Stay

    Bottom line is I'm going to be found inside IR35 based on what HR have told me they are going to be inputting into CEST regarding my role.

    Now I face a real quandary because I'm actually at a client I really like for the first time in ages. I enjoy the work, the people are pleasant, it's an ok rate and it's right on my doorstep.

    The alternative is to turn down the 6 month extension they've offered and find something else. Not really sure what the market is like for javascript devs at the moment but I predict a spell on the bench before I find a gig within a reasonable commuting distance (I'm ruling out anything that involves staying away from home unless it's outside IR35).

    I want to stay but I'm aware that there is some risk in going from outside to inside in the same role. My slant on it is that I've only been there since September so I've just got 6 months exposure. The worry is that once they've got their teeth into me, they might go further back into my work history which potentially could be ruinous even with all the insurances in place.

    Just putting it out there as I'm sure there are plenty of others facing the same dilemma.

    #2
    Originally posted by Martin Bank Holiday View Post
    Bottom line is I'm going to be found inside IR35 based on what HR have told me they are going to be inputting into CEST regarding my role.

    Now I face a real quandary because I'm actually at a client I really like for the first time in ages. I enjoy the work, the people are pleasant, it's an ok rate and it's right on my doorstep.

    The alternative is to turn down the 6 month extension they've offered and find something else. Not really sure what the market is like for javascript devs at the moment but I predict a spell on the bench before I find a gig within a reasonable commuting distance (I'm ruling out anything that involves staying away from home unless it's outside IR35).

    I want to stay but I'm aware that there is some risk in going from outside to inside in the same role. My slant on it is that I've only been there since September so I've just got 6 months exposure. The worry is that once they've got their teeth into me, they might go further back into my work history which potentially could be ruinous even with all the insurances in place.

    Just putting it out there as I'm sure there are plenty of others facing the same dilemma.
    Firstly, why are any businesses using CEST to assess the status of an engagement. The tool has well documented flaws and even HMRC won't stand by the results it spews out.

    Secondly, if you accept an extension to a contract and switch from operating outside to inside then you are absolutely putting yourself at risk of retrospective tax action.

    Worse than that though is that HMRC will take cases like yours to prove their argument that contractors have been paying too little tax and justify the roll out of the legislative change.

    It sounds like your client could do with speaking with an IR35 specialist to discuss ways they can engage contractors on a genuinely outside IR35 basis.

    Comment


      #3
      Originally posted by Patrick@Intouch View Post
      Firstly, why are any businesses using CEST to assess the status of an engagement. The tool has well documented flaws and even HMRC won't stand by the results it spews out.

      Secondly, if you accept an extension to a contract and switch from operating outside to inside then you are absolutely putting yourself at risk of retrospective tax action.

      Worse than that though is that HMRC will take cases like yours to prove their argument that contractors have been paying too little tax and justify the roll out of the legislative change.

      It sounds like your client could do with speaking with an IR35 specialist to discuss ways they can engage contractors on a genuinely outside IR35 basis
      .
      I've mentioned in previous posts that the client is no longer engaging with contractors whether inside or outside. The risk is being pushed to a single preferred agency & the outcome will be that the agency will set up a payroll & deduct PAYE.

      Comment


        #4
        You only have been there since Sept 2019 so the risk to you is minimal.

        You like the client and you are OK with accepting an inside IR35 determination - so stay. Stop worrying. Enjoy the contract, it won't last forever and then you can choose to find an outside IR35 one if you want to.

        Comment


          #5
          Apologies if I've missed something then as I haven't seen those posts.

          If they aren't engaging with contractors then why are the bothering with CEST and status assessments at all?

          Will you be operating through an Umbrella or through your PSC but on an inside IR35 basis?

          Comment


            #6
            Originally posted by ChimpMaster View Post
            You only have been there since Sept 2019 so the risk to you is minimal.

            You like the client and you are OK with accepting an inside IR35 determination - so stay. Stop worrying. Enjoy the contract, it won't last forever and then you can choose to find an outside IR35 one if you want to.
            These are my thoughts...

            Originally posted by Patrick@Intouch View Post
            Apologies if I've missed something then as I haven't seen those posts.

            If they aren't engaging with contractors then why are the bothering with CEST and status assessments at all?

            Will you be operating through an Umbrella or through your PSC but on an inside IR35 basis?
            Because they are doing the determinations but pushing the risk onto the agency. Not sure of the finer details of how things will work with the agency yet as they haven't decided who that agency will be.

            Comment


              #7
              1. Calculate what your PAYE/EeNIC/ErNIC liability would be on the outside portion of your engagement and put it in a high interest savings account.
              2. Take the extension if the numbers stack up and you're happy with the take home package.

              Comment


                #8
                Originally posted by Martin Bank Holiday View Post
                These are my thoughts...



                Because they are doing the determinations but pushing the risk onto the agency. Not sure of the finer details of how things will work with the agency yet as they haven't decided who that agency will be.
                The risk is not with the agency.

                The company don't want the hassle of operating the payroll for temps so they've engaged an agency.

                If the company got the determination wrong, they are still liable. But, as they've determined everyone as inside, there is no liability as you can't claim for a refund of the tax and NI falsely deducted.

                Comment


                  #9
                  Originally posted by ladymuck View Post
                  1. Calculate what your PAYE/EeNIC/ErNIC liability would be on the outside portion of your engagement and put it in a high interest savings account.
                  2. Take the extension if the numbers stack up and you're happy with the take home package.
                  Supposing I'm investigated in the future after already having paid corporation & dividend tax on the year in which I worked the outside IR35 portion. Presumably these amounts would be deductible from the PAYE/EeNIC/ErNIC liability?

                  Comment


                    #10
                    Originally posted by Martin Bank Holiday View Post
                    Supposing I'm investigated in the future after already having paid corporation & dividend tax on the year in which I worked the outside IR35 portion. Presumably these amounts would be deductible from the PAYE/EeNIC/ErNIC liability?
                    I very much doubt it, but no-one really knows.

                    It's a gamble/risk either way.

                    (But as others have said only a 6 month one in your case.)
                    "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
                    - Voltaire/Benjamin Franklin/Anne Frank...

                    Comment

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