Inside IR35 - OutSide IR35

[rexx]

I have been working for a public company for the past 2 years. When I joined I was put inside IR35.
During this time I realised all other contractors working for same company but different managers were outside IR35. They were no differences in the jobs we were doing. As a result of this I made mistake to join umbrella company which has resulted in me having to pay the loan charge.

A new manager has now taken over my department and they ran the IR35 tool and they have put me outside of IR35. They would like to extend me for another 6 months and I will have a new contract outside IR35.

What is the risk with this ?

[jamesbrown]

For you personally? Not very high, providing you have not sought to mislead them in any way (highly doubtful that you could), because the responsibility and liability rests with the Fee Payer (or client), not you or YourCo (were you to create one). As you may know, the IR35/ITEPA legislation will mostly likely change in April, but these changes are comparatively small for public sector contracts; for example, you should receive a Status Determination Statement from the client.

In terms of the umbrella company, as you've sadly learned to your cost, that was a tax avoidance scheme masquerading as a legitimate umbrella company:

Disguised as an umbrella company | All Umbrella Companies Are Equal

edit: Oh, by the way, I interpreted "public company" as public sector. If you are not in the public sector, then my answer is slightly different. In that case, prior to April, the risk is with you. After April, the risk is with the supply chain above you.

[northernladuk]

The mistake wasn't joining an umbrella. That was probably your only option at the time. It was the choice of umbella that was the problem. Are you still with the bad one or did you manage to swap to a compliant one at some point during the engagement?

If you are going to continue working there make sure you are very familiar with IR35. Being public sector it's very easy to become part and parcel. I know the risk is on your client to make the determination but that's no reason to get slack and put your own status at risk. Who knows what is coming down the line in the future.

Still can't claim expenses though as you are over the 24 month rule.

Being public sector do they not have a 2 year limit on contractors? Many don't but there are still some.

[rexx]

The mistake wasn't joining an umbrella. That was probably your only option at the time. It was the choice of umbella that was the problem. Are you still with the bad one or did you manage to swap to a compliant one at some point during the engagement?

If you are going to continue working there make sure you are very familiar with IR35. Being public sector it's very easy to become part and parcel. I know the risk is on your client to make the determination but that's no reason to get slack and put your own status at risk. Who knows what is coming down the line in the future.

Still can't claim expenses though as you are over the 24 month rule.

Being public sector do they not have a 2 year limit on contractors? Many don't but there are still some.

I left the loan scheme umbrella and joined a proper one. But now will use my limited company..I am with a university. They have no limit. Some have been there over 3 years..So maybe i will retire there -

[northernladuk]

I smell the next shake up of the IR35 landscape once HMRC have gotten bored with this one.