Discussion document on IR35 published

[gingerjedi]

The amount you pay as CT and on dividends is a small proportion of the amount that you would pay as an employee, PLUS you would pay National Insurance PLUS your employer would pay NIC.

In addition you would not be able to claim travel etc.

That's assuming you'd want to carry on contracting being taxed as an employee without the benefits, I for one would throw the towel in and go perm close to home on a much reduced rate as the ongoing expense from my own pocket would be out of the question.

So how has the government squeezed more tax from me in that scenario?

It's been mentioned before but the only solution that will make people move from their entrenched positions is some middle ground between paying a lot more/less tax than an equivalent employee.

[webberg]

Directing and modelling the result - a suggestion

Will BIG GROUP take information to feed into its consultation feedback?

Yes.

Will BIG GROUP work with others here?

Yes.

BIG GROUP has a calculator. It compares the 15/16 position with 16/17 - 19/20 taking into account the changes to dividend taxation and expenses taxation. We have yet to decide how to deploy that.

That model however could be used to process the sort of data being requested here in order to show HMRC the impact of their ideas. Again, I would have to consider how to deploy it.

The above posts (and this one) are all supply side. The real difference would come if the demand side of the equation came out against changes. Would a client want the risk of having an employee from a legal or tax perspective? What would their insurance company think? How might their accounts reflect the potential risk of future tax bills? Would this damage their SME status if they are close to FTE for certain incentives or grants?

Some thought into how to raise awareness QUICKLY is needed.

Perhaps a flyer (contributed to by those who make a living from contractors) that you can give to your client pointing out risks?

Perhaps a briefing note to the CBI and other employer/client groups?

Perhaps a briefing note to all your MP's?

Perhaps, perhaps...

There are two aspects here that need solving FAST.

The first is that preparing the above needs organisation and leadership. The commercial ventures in this space (Umbrellas, accountants, advisers and yes, BIG GROUP) all have the ability to do this but charge for their time. How much? I don't know.

Would everybody here and at other places be prepared to contribute £20?

The second is that there are probably as many opinions as there are people. Whilst throwing in every valid argument and nugget of data is good and if properly presented might make a difference, any submission has to be relevant and focused. It may be therefore that a final paper might not include a favourite hobby horse (in which case it can be made as an individual) or your favourite idea. Being part of a group you have to accept that this is the price.

I suggest:

1. Consider a fund raise via one of the crowd funding platforms.
2. Have a small committee in charge of funds
3. Same committee to appoint suitable people to prepare a submission*
4. Any funds not used to pay for 3 above, are returned pro rate.

* "Suitable people" should be those who work in this sector and are knowledgeable in how this sector works, the impact of the changes proposed and HMRC. The latter seems to be bouyed in confidence by acting on behalf of a Government who know that unwelcome changes now will be largely forgotten by the next election and are determined to press through unpopular revenue raising measures.

Discuss

[eek]

And once again webberg is after money.

I'm sorry but I really don't see what you bring to the party here..... And given your background in tax avoidance schemes personally I don't want to be in any way associated with you as I your associate will do more harm than good.

And we don't need evidence of what the impact will be. Genuine evidence of how much is spent on travel would be useful but guess works on what it would look like afterwards won't interest HMRC no matter what you think...

[webberg]

And once again webberg is after money.

I'm sorry but I really don't see what you bring to the party here..... And given your background in tax avoidance schemes personally I don't want to be in any way associated with you as I your associate will do more harm than good.

And we don't need evidence of what the impact will be. Genuine evidence of how much is spent on travel would be useful but guess works on what it would look like afterwards won't interest HMRC no matter what you think...

As you wish. If your view is a general one, I'll happily focus my attention elsewhere.

You DO need evidence of impact and with the experience of having made responses to dozens of such consultations, I would respectfully disagree with all of your second paragraph.

[TheMrs]

Surely the Govt would look to the existing IR35 rules enforced atm when contracting thru a PSC to public sector client?

If that is the case then anyone with a genuinely non IR35 contract has nothing to fear? Yes we will need to routinely pay for reviews (which I do anyway) and possibly the investigation insurance will increase in price but that will still be reasonable.

Having said this I've never contracted for public sector as am oil industry based so doubtless others know better. ..

[tractor]

....

Will BIG GROUP take information to feed into its consultation feedback?

Yes.

Will BIG GROUP work with others here?

Yes.

BIG GROUP has a calculator. It compares the 15/16 position with 16/17 - 19/20 taking into account the changes to dividend taxation and expenses taxation. We have yet to decide how to deploy that.

That model however could be used to process the sort of data being requested here in order to show HMRC the impact of their ideas. Again, I would have to consider how to deploy it.

The above posts (and this one) are all supply side. The real difference would come if the demand side of the equation came out against changes. Would a client want the risk of having an employee from a legal or tax perspective? What would their insurance company think? How might their accounts reflect the potential risk of future tax bills? Would this damage their SME status if they are close to FTE for certain incentives or grants?

Some thought into how to raise awareness QUICKLY is needed.

Perhaps a flyer (contributed to by those who make a living from contractors) that you can give to your client pointing out risks?

Perhaps a briefing note to the CBI and other employer/client groups?

Perhaps a briefing note to all your MP's?

Perhaps, perhaps...

There are two aspects here that need solving FAST.

The first is that preparing the above needs organisation and leadership. The commercial ventures in this space (Umbrellas, accountants, advisers and yes, BIG GROUP) all have the ability to do this but charge for their time. How much? I don't know.

Would everybody here and at other places be prepared to contribute £20?

The second is that there are probably as many opinions as there are people. Whilst throwing in every valid argument and nugget of data is good and if properly presented might make a difference, any submission has to be relevant and focused. It may be therefore that a final paper might not include a favourite hobby horse (in which case it can be made as an individual) or your favourite idea. Being part of a group you have to accept that this is the price.

I suggest:

1. Consider a fund raise via one of the crowd funding platforms.
2. Have a small committee in charge of funds
3. Same committee to appoint suitable people to prepare a submission*
4. Any funds not used to pay for 3 above, are returned pro rate.

* "Suitable people" should be those who work in this sector and are knowledgeable in how this sector works, the impact of the changes proposed and HMRC. The latter seems to be bouyed in confidence by acting on behalf of a Government who know that unwelcome changes now will be largely forgotten by the next election and are determined to press through unpopular revenue raising measures.

Discuss

Why would anyone wish to do any of the above when they can contribute to the IPSE call for comments both without cost and without being a current member?

If your organisation really is that bothered, why don't you call IPSE and ask if you can help?

EDIT: No, you cannot have £20

[webberg]

Why would anyone wish to do any of the above when they can contribute to the IPSE call for comments both without cost and without being a current member?

If your organisation really is that bothered, why don't you call IPSE and ask if you can help?

EDIT: No, you cannot have £20

Am I that bothered?

I made a suggestion if how things could be organised and how the con docs might be responded to.

Did I ask for £20?

I think I suggested that this is raised and held by a group of you people.

Did I pitch for the work?

Don't think so. As noted already in this thread, there are many firms active here and probably the top accounting and law firms (who promise access to the highest levels of influencers in Treasury) would be a better choice.

The point is to take action.

If the condoc proposals are enacted as presently drafted, most of you will be forced into some form of employee relationship or will look for the sort of aggressive structures you see advertised on the net which will inevitably be the subject of enquiry in a few years time.

[eek]

Right,

I'm going to set up an online survey to see if we can collect some figures: Thinking of the following questions:-

Industry sector (IT / Oil / Business Consulting...)

Travel Expenses last month :
Average monthly expenses last 3 years:

Percentage of turnover: %

Stay over during week: Y / N

Travel distance to current client : xx miles / xx hours
Average distance to client last 3 years: xx miles / xx hours

Number of different clients last 3 years:
Multiple clients at some time: Y / N

Do you agree with these statements

These are legitimate costs that I would not incur as a permanent employee: Y/N

If the proposals go through so you can no longer claim expenses it will significantly affect my ability to travel for contracts as it will make it more costly for me to travel between client sites as needed. Y/N

Anything else people can suggest or wish to amend?

Once I've done this (over the weekend) I'll share the link so people can advertise it. I plan to correlate the results in the last week of august...

[Danglekt]

Cheers EEK

[Coalman]

I'm in a difficult position on this.

I've been with current local client more than 2 years (slight break last year) so cannot currently claim expenses based on 24 month rule. I will be here a while longer as the project I'm on is a train wreck!

I have a second client which I do very occasional work supporting thier sales operations (and projects if we sold anything) which does involve a lot of travel. This will be affected but hard to quantify.

The big thing for me is FUTURE work. I am centrally based so can commute at 1hr approx to a a good number of locations, and chosen to live near a train line to London so can contract in London if cannot find anything local. Expecting to have to do this at some point, and expecting to have to stay in London 3-4 nights a week to support this. This is now going to be very financially difficult to do unless rates increase to cover the costs.

Eek - is your survey going to be able to capture this kind of issue, i.e. impact on future work or is this irrelevant as it is not a current example.