IR35 Hell - Am I going to lose everything

[meanttobeworking]

Apologies if this is a dense question, but if an IR35-caught debt is attached to the company and unlikely to be transferable to the individual, how come IR35 insurance and/or IPSE membership is taken out by the individual?

Come on NLUK, hit me with it...

[jamesbrown]

Apologies if this is a dense question, but if an IR35-caught debt is attached to the company and unlikely to be transferable to the individual, how come IR35 insurance and/or IPSE membership is taken out by the individual?

Come on NLUK, hit me with it...

My IPSE membership is invoiced to MyCo, although it's possible to join IPSE as an individual too.

In terms of IR35 tax loss insurance, YourCo will be the designated "Insured", not you personally. In the event that YourCo has a ruling against it, any insured amount due will be paid to YourCo, which can then use this money to settle the debt (or part thereof). So the short answer is that your description is incorrect.

[mudskipper]

Apologies if this is a dense question, but if an IR35-caught debt is attached to the company and unlikely to be transferable to the individual, how come IR35 insurance and/or IPSE membership is taken out by the individual?

Come on NLUK, hit me with it...

It's a bit of a mish-mash - it's the individual worker who is subject to IR35, but it is the company's responsibility to deduct the correct NI and tax.

[northernladuk]

Can I still hit him with it or am I too late to the party?

[d000hg]

Have you closed yourCo? The tax liability is for yourCo, so if yourCo no longer exists, there's no money for them to come after. I went to a tax talk by Paul Mason from Abbey Tax - HMRC can only come after you personally for the debt if you have been wilfully negligent. If you had a review, which passed, it would be hard to suggest that. If you closed your company or cleared out the dosh after the investigation started, then that might be grounds. So, in short, they can only get their mitts on yourCo's money unless you've taken the mick. Have a to be going on with, and try not to lose sleep.

Is that really true? I thought these days HMRC were able to ride rough-shod over such petty things like that Otherwise it rather seems a bit of a loophole; start a new company for each contract!

[northernladuk]

Is that really true? I thought these days HMRC were able to ride rough-shod over such petty things like that Otherwise it rather seems a bit of a loophole; start a new company for each contract!

That's what I read. They can block the closure and force a re-opening but article writer said she's never seen in. It's an article by Kate on here. She does point out out closing the company for this could be evasion and other things as well though.

[SueEllen]

Is that really true? I thought these days HMRC were able to ride rough-shod over such petty things like that Otherwise it rather seems a bit of a loophole; start a new company for each contract!

Which is impractical to do.

[psychocandy]

Least OP has got IPSE representation..... Abbey Tax are very good.

Did I hear a while ago that nobody had lost an IR35 case whilst being represented by IPSE??? Or is that an urban myth?

[d000hg]

Which is impractical to do.

Out of curiosity, why?

[LondonManc]

Apologies if this is a dense question, but if an IR35-caught debt is attached to the company and unlikely to be transferable to the individual, how come IR35 insurance and/or IPSE membership is taken out by the individual?

Come on NLUK, hit me with it...

From what I've read it depends on the IR35-caught nature. If you've legitimately ignored IR35 then you're liable; if you're a good boy who's been shafted by bad HR but have plenty of other evidence that you were operating outside then they'll struggle to get near you.