End of contractors at any GOV.UK project after April 2017 End of contractors at any GOV.UK project after April 2017
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  1. #1

    More time posting than coding


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    Default End of contractors at any GOV.UK project after April 2017

    Sunday morning reading, ruminating and musing

    Based the recent Autumn 2016 statement from the chancellor

    "From 6th April the responsibility for determining IR35 status in public sector engagements will shift from the contractor to the party paying them, which will usually be the recruitment agency. This means the agency will also be liable if they decide a contractor can work outside IR35 and their decision is subsequently challenged by HMRC."

    does this mean independent contractors should be avoid any form GOV.UK that takes their contract end date beyond 5th April 2017?

    Based on my own reading of this statement, it means that even if a current contract initially looks outside IR35 at the time, in the future it could be viewed as inside IR35 retrospective long after the contract has expired. That being case, any independent contractor ought to avoid GOV.UK 2017 work if the pay scale contract rates remain the same. In other words, GOV.UK would have to compensate contractors at a much higher contract rate, say 10%, via the recruitment agency, but that would be a conflict of interest with the aim of the Autumn statement announcement.

    "HMRC are convinced that there is widespread ‘non-compliance’ in the public sector, estimating that 90% of ‘off payroll’ workers are not paying tax correctly."

    It is a quite sad that there were / are some parts of the Government Digital Service and GOV.UK that were / are building interesting technology software. Azure/AWS/Cloud/PHP/Java/Microservices/Digital/Agile **** What a cluster (tulip)!

  2. #2

    Double Godlike!

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    A bit late to the party but totally agree!
    Blog? What blog...?

  3. #3

    bored now

    eek's Avatar
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    I wouldn't, however, state that a 10% increase in rates is enough. Given that a contract inside ir35 doesn't allow expenses I would need a lot more than 10%.
    merely at clientco for the entertainment

  4. #4

    Nice But Dim

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    Quote Originally Posted by eek View Post
    I wouldn't, however, state that a 10% increase in rates is enough. Given that a contract inside ir35 doesn't allow expenses I would need a lot more than 10%.
    Indeed, closer to 40% I wouldd estimate,
    "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

  5. #5

    My post count is Majestic

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    Hope we aint gonna be getting too many more of these lazy questions. 2 today already :
    'CUK forum personality of 2011 - Winner - Yes really!!!!

  6. #6

    bored now

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    Quote Originally Posted by northernladuk View Post
    Hope we aint gonna be getting too many more of these lazy questions. 2 today already :
    These are still the small minority well ahead of the game. Most will only know what's happening when their fence does the deductions and they see the far smaller payment arrive
    merely at clientco for the entertainment

  7. #7

    Nice But Dim

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    Quote Originally Posted by eek View Post
    These are still the small minority well ahead of the game. Most will only know what's happening when their fence does the deductions and they see the far smaller payment arrive
    More likely when their contracts get cancelled and new ones get issued with the new payment terms, but the effect will be much the same.
    "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

  8. #8

    My post count is Majestic

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    Quote Originally Posted by eek View Post
    These are still the small minority well ahead of the game. Most will only know what's happening when their fence does the deductions and they see the far smaller payment arrive
    Maybe we can lock the forums around that time then
    'CUK forum personality of 2011 - Winner - Yes really!!!!

  9. #9

    Some things in Moderation

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    I think that we are going to need TL;DR stickies on this for the B/C and A/L forums from now on.
    "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...

  10. #10

    bored now

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    Quote Originally Posted by DaveB View Post
    More likely when their contracts get cancelled and new ones get issued with the new payment terms, but the effect will be much the same.
    The cynic in me says that they will assume it's just a renewal. And then you have the agencies who when hmos did their changes were trying to argue that the tax changes were not a material change to the contract and that the old contract was valid regardless of the new tax terms
    merely at clientco for the entertainment

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