Hammond plans tax crackdown on 'synthetic self-employed' Hammond plans tax crackdown on 'synthetic self-employed' - Page 2
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  1. #11

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    Nobody actually expected him to listen to the consultation responses did they? The comments on the BBC article make it clearly obvious that this is a fairly "uncontroversial" move given that a) most non-contractors/freelancers really understand what this is all about and b) the general public clearly think we're all tax avoiding shysters and would support this.

    But I'm not completely pessimistic, I think there's a good chance that this will backfire on the government and all that will happen is most clients will be happy to work with their contractors on an outside IR35 basis and that is a *good* thing for us because it puts the onus on the client to take what being "outside IR35" means more seriously and realising they cannot exert direction or control over us. They might even become more amenable to genuine unfettered RoS clauses if they think it covers their arses.

  2. #12

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    Quote Originally Posted by TheCyclingProgrammer View Post
    But I'm not completely pessimistic, I think there's a good chance that this will backfire on the government and all that will happen is most clients will be happy to work with their contractors on an outside IR35 basis and that is a *good* thing for us because it puts the onus on the client to take what being "outside IR35" means more seriously and realising they cannot exert direction or control over us. They might even become more amenable to genuine unfettered RoS clauses if they think it covers their arses.
    This is where I'm at - if not, I've got faith that market forces will dictate that prices will rise to compensate. Either way, I don't think we're going to lose out in the same way as taking an IR35 contract today.

    Still a load of crap, of course, but I'll definitely wait and see.

  3. #13

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    Quote Originally Posted by TheCyclingProgrammer View Post
    Nobody actually expected him to listen to the consultation responses did they? The comments on the BBC article make it clearly obvious that this is a fairly "uncontroversial" move given that a) most non-contractors/freelancers really understand what this is all about and b) the general public clearly think we're all tax avoiding shysters and would support this.

    But I'm not completely pessimistic, I think there's a good chance that this will backfire on the government and all that will happen is most clients will be happy to work with their contractors on an outside IR35 basis and that is a *good* thing for us because it puts the onus on the client to take what being "outside IR35" means more seriously and realising they cannot exert direction or control over us. They might even become more amenable to genuine unfettered RoS clauses if they think it covers their arses.
    Agree with this assessment, esp. for those at the upper end of the contracting market.

  4. #14

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    Quote Originally Posted by Matt88 View Post
    I think you've not been an employee for so long, you forget how businesses are run. They follow all legislation! Religiously! And they'll start scrutinizing everyone they hire, and ensure their hires are following IR35 to the letter of the law.

    In fact, they'll probably go overboard and only hire contractors who adhere to IR35 I imagine.

    £35k a year employees, earning £100k+ a year, was never really sustainable. I know it's fantastic for you, because there's no chance in hell you'd ever earn a really high salary as an actual employee, but why on earth are the people in the government just turn a blind eye to all this stuff.

    You had a nice run, and I'm sure you think you're something special, but you're not. You're people who would be earning £30-40k if you were an employee. So why on earth should you earn double that (a lot of which is tax avoidance) just because you have to pay your own pension, and holiday pay.

    IT Contractors should be earning e £50k a year max. That compensates them fully for the pension, holiday pay, health insurance, sick pay

    Ok, I'll bite. Having looked at the sort of employee salaries for the type of contract I do, they are coming in at roughly my contract rate allowing for sick pay/holiday pay, pension and other benefits. And when I was employed for a little while about 3 years ago that is the range I was looking at and achieved. Its not at all a question of thinking one is special just trying to command the very best rate/salary you can in order to support yourself and your family. I'm not going to lower myself to explaining in any detail why capping salary is a terrible Marxist idea which benefits no-one, but since we have in the private sector a system where largely specialists, contractors and staff are paid per their expertise then that expertise is rewarded with a higher rate/salary.

    You make sweeping statements about tax avoidance (which might I add is legal) - after dividend tax, corporation tax and all the other stuff LTD contractors pay for I calculate that the gap in tax take if I was an employee is about 6.5k in my favour when the money arrives in my account. I'm making the assumption that you are a permanent employee and never have to worry about trifling stuff like being benched, getting all the various insurances, paying for an accountant, your own training, jumping through all the hoops that the yearly budget tosses up.

    Nobody is special in this world - not even you - largely in the private sector certainly we all get the rate/salary that we are worth in the business we work in - and that includes contractors and permies.

  5. #15

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    Quote Originally Posted by TheCyclingProgrammer View Post
    But I'm not completely pessimistic, I think there's a good chance that this will backfire on the government and all that will happen is most clients will be happy to work with their contractors on an outside IR35 basis and that is a *good* thing for us because it puts the onus on the client to take what being "outside IR35" means more seriously and realising they cannot exert direction or control over us. They might even become more amenable to genuine unfettered RoS clauses if they think it covers their arses.
    This is what has happened in the public sector. I work outside IR35, and the decision and liability isn't mine. Even HMRC hire contractors outside IR35!
    Cats are evil.

  6. #16

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    Quote Originally Posted by swamp View Post
    This is what has happened in the public sector. I work outside IR35, and the decision and liability isn't mine. Even HMRC hire contractors outside IR35!
    I don't work in the public sector, I'd assumed it had gone the other way there as public sector clients didn't want to be seen to be supporting "tax avoidance" (look at the bad press the BBC gets with its presenters for example). Interesting to hear it's already happening there.

  7. #17

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    Quote Originally Posted by Matt88 View Post
    I think you've not been an employee for so long, you forget how businesses are run. They follow all legislation! Religiously! And they'll start scrutinizing everyone they hire, and ensure their hires are following IR35 to the letter of the law.

    In fact, they'll probably go overboard and only hire contractors who adhere to IR35 I imagine.

    £35k a year employees, earning £100k+ a year, was never really sustainable. I know it's fantastic for you, because there's no chance in hell you'd ever earn a really high salary as an actual employee, but why on earth are the people in the government just turn a blind eye to all this stuff.

    You had a nice run, and I'm sure you think you're something special, but you're not. You're people who would be earning £30-40k if you were an employee. So why on earth should you earn double that (a lot of which is tax avoidance) just because you have to pay your own pension, and holiday pay.

    IT Contractors should be earning e £50k a year max. That compensates them fully for the pension, holiday pay, health insurance, sick pay
    Your not very good at this are you...... you just embarrassed yourself. Move a long to a perm forum.

  8. #18

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    I tend to agree that Employers in the Private sector are likely to do more to comply to make sure your outside IR35 to ensure that their flexible workforce is maintained without incurring any headaches from having to provide “rights” which could easily come in alongside.

    Although I suspect that some more “risk averse” organisations may just make blanket determinations to avoid any risk of being hit with fines/legal battles from HMRC later.

  9. #19

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    Quote Originally Posted by cmscotland View Post
    Although I suspect that some more “risk averse” organisations may just make blanket determinations to avoid any risk of being hit with fines/legal battles from HMRC later.
    Since the Susan Winchester case, where she successfully claimed holiday pay after being declared inside IR35, clients will find themselves between the devil and the deep blue sea.

    Declare outside and risk investigation. Declare inside and risk litigation (or contractors walking).

    Hammond is about to open a Pandora's box!
    Cats are evil.

  10. #20

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    IT contractors should be earning £50k max?

    Oh Dear, as if we were all the same. You know who will also be crying into their beer? Agents - you can see all that work and commission going down the Swanny.

    Contractors will be flexible because that’s in their nature. I’m not sure about agents though.

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