Can HR rip me off?

[darrenb]

Hi,

I'm on a good contract, signed paperwork, payment being received reliably from the agency to my company account. But I'm still paranoid.

Is it possible for the end-client to take any action that might affect my IR35 status? For instance, supposing a malicious HR person (and there is always one) submitted a P38 or some other form to HMRC, would that force me to pay PAYE? If so, is there any way I can check this?

As you can probably tell, I'm new to UK contracting and want to avoid a nasty surprise at tax time.

D.

[Troll]

No ... next

[triboix]

Hi,

I'm on a good contract, signed paperwork, payment being received reliably from the agency to my company account. But I'm still paranoid.

Is it possible for the end-client to take any action that might affect my IR35 status? For instance, supposing a malicious HR person (and there is always one) submitted a P38 or some other form to HMRC, would that force me to pay PAYE? If so, is there any way I can check this?

As you can probably tell, I'm new to UK contracting and want to avoid a nasty surprise at tax time.

D.

Have you got your contract reviewed? The contract terms are the main indicator to whether you are inside or outside IR35.
Now if somebody does something nasty or stupid, you are on the right side of things anyway. It's anyway a good idea to take an insurance against such legal costs. You may be sure you are outside IR35, but maybe HMRC is not. So they may challenge you and such an insurance will be handy at relieving this stress off your shoulders.

Advice: become a member of the PCG if not already done. It comes with an IR35 insurance, legal helplines, etc.

HTH

[Ardesco]

You aren't an employee so HR are not going to even try and get involved in your tax affairs. They have much more important things to do like treating company employees like tulipe, gossip about confidential things involving time off various permies have had, sitting on thier asses and doing nothing despite telling everybody they are extrememly busy, making up job specs that include stupid requirements such as *MUST* have 5 years experiance in Windows Vista, etc

[DaveB]

The one to be worried about is if you get a PAYE investigation. They are likely to contact current and previous clients to try and establish the working practices used during the contract period. All it takes is one clueless fecker in Human Remains to give them the standard company employee spiel and you're shafted.

[oraclesmith]

In my opinion, the best way of dealing with this is to avoid giving the client any personal information about you at all. You are an employee/Director of another company and therefore there is no need for HR to have any details of you whatsoever, unless it's for security reasons and even then it should only be necessary to give you access as an 'external'. Never let them have your home address, date of birth etc. If your office address is also your home address, don't mention the fact to anyone. Always refer to your limited company when dealing with the client's staff and always deal with the procurement side of the client's business and not HR.

[Newby]

What a load of nonsense triboix, do you really think that when the revenue investigates a company they ask to see your contract, have a quick glance say "oh that is outside of IR35, sorry to have distrurbed you, goodbye".

I think you might find that they go into every intricate detail of how you have run your company from an accounting perspective, contractually how you have engaged your customers, and also in how your working practices differ from those of staff workers on the same site, and if your provide services that are classed as outside of IR35.

A PAYE audit can be how it all starts, and then they will just keep digging and digging and digging until they find something.

Surely your accountant is giving you advice on this subject, if you are paying him then he should be. Simon and Darren on here would definitely give you more support than you are getting right now, I would even expect a half decent management company to do the same.

I hate to be dismissive, but should you be contracting if you are concerned that you are going to be caught evading tax, HMRC would have a field day with you. Check the sticky thread out in this section and get a good accountant.

Good Luck.... you are going to need it.

[ChimpMaster]

I thought IR35 was dead anyway? It will be when Cameron gets in.

[triboix]

What a load of nonsense triboix,

Thank you.

do you really think that when the revenue investigates a company they ask to see your contract, have a quick glance say "oh that is outside of IR35, sorry to have distrurbed you, goodbye".

I think you might find that they go into every intricate detail of how you have run your company from an accounting perspective, contractually how you have engaged your customers, and also in how your working practices differ from those of staff workers on the same site, and if your provide services that are classed as outside of IR35.

Well, I forgot to be clear about that: the contract is only 1 aspect. It is still "the entry point" to assess your relationship with the client.

A PAYE audit can be how it all starts, and then they will just keep digging and digging and digging until they find something.

Surely your accountant is giving you advice on this subject, if you are paying him then he should be. Simon and Darren on here would definitely give you more support than you are getting right now, I would even expect a half decent management company to do the same.

I am with SJD, so Simon in that case.
Simon? apparently, you are not doing a good work...

I hate to be dismissive, but should you be contracting if you are concerned that you are going to be caught evading tax, HMRC would have a field day with you. Check the sticky thread out in this section and get a good accountant.

Good Luck.... you are going to need it.

Well, I though I had a good accountant, according to common opinions expressed on this board...
Keep in mind that as long as you do not structure your business in order to maximize your tax burden, you are always at risk of an investigation, whether you have done something illegal or not.

[DaveB]

Thank you.


Well, I forgot to be clear about that: the contract is only 1 aspect. It is still "the entry point" to assess your relationship with the client.


I am with SJD, so Simon in that case.
Simon? apparently, you are not doing a good work...


Well, I though I had a good accountant, according to common opinions expressed on this board...
Keep in mind that as long as you do not structure your business in order to maximize your tax burden, you are always at risk of an investigation, whether you have done something illegal or not.

If you are in business and submitting personal tax returns you are always at risk of an investigation full stop. The issue is whether you are at risk of being caught doing something you shouldnt. If you have a good accountant and are a PCG member or have other tax investigation insurance then you have done all you can. If you are still worried then maybe contracting isnt for you. Otherwise forget about and get on with billing your clients.