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Accountants in Denial over IR35

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    Accountants in Denial over IR35

    SJD sends an email after every budget announcement, take a gander at the below:

    "Yesterday the Chancellor delivered his 2018 Autumn Budget.

    The extension of the public sector IR35 reforms to the private sector was the most widely anticipated announcement, and it’s welcome that the Chancellor has listened to representations regarding the timing of the changes which have now been proposed for April 2020.

    The Chancellor has also listened to representations from smaller businesses and will only extend the rules to large and medium-sized enterprises that use contractors.

    A further consultation on the operation of the new rules will be published in the coming months, with draft legislation expected to be published in the summer of 2019.

    This means current IR35 best practice remains and our accountants are well placed to support and advise you if you have any doubt. We will keep you updated with all the latest developments, however for the next 17 months it is business as usual.

    For further information on the IR35 reforms as well as details of the full budget summary please follow this link. Or, if you'd prefer a further deep dive into the budget, click the link below to our full guide."


    Now is it just me being my cynical self, or is that email a tad optimistic and shying away from the fact that this is a complete industry changer? Of course SJD will want to sugar coat the impact of this to stop a mass exodus of clients (I will be off next year, winding up, claiming ER, going brolly, waiting 2 years then spinning up another LTD once the dust settles and if it is favourable).

    It's the business as usual part which get's me, its not ******* business as usual, to advise clients to just carry on up until April 2020 and make no plans/provision for it is horrendous advice.

    All accountants will be the same I imagine, hoping something changes to save their business model's, they must know they are ****ed.

    #2
    This is SJD we're talking about. Probably best to ignore 90% of their advice. And in my experience at least, the other 10% is usually inappropriate
    Blog? What blog...?

    Comment


      #3
      It is in SJD's interests to sugar coat this to their clients - they need to hold on to as many clients as they can so that they can continue to service their debt to the bank.

      On their last accounts, their holding company (Optionis Limited) carried debt of £166m, made a EBITDA of £19m and paid almost £17m of it in interest - that doesn't just go away if they lose clients.

      Comment


        #4
        Now is it just me being my cynical self, or is that email a tad optimistic and shying away from the fact that this is a complete industry changer? Of course SJD will want to sugar coat the impact of this to stop a mass exodus of clients (I will be off next year, winding up, claiming ER, going brolly, waiting 2 years then spinning up another LTD once the dust settles and if it is favourable).
        How do you know it's an industry changer? And if it is what will be the changes? Pain in the ass in Public Sector yes but there are plenty of outside people still working there. Look back to the day after the PS were announced a few years ago and a ton of newbies were wailing about the end of contracting in the PS and it's not. SJD and many of the other accountants have been through this time and time again and the arse hasn't fallen out of anything yet.

        Way to go you for planning to lose 20% of your income when you've no idea what's going to happen. Let's see if you do it or not hey. Oh.. And you think ER will still be available then?
        It's the business as usual part which get's me, its not ******* business as usual, to advise clients to just carry on up until April 2020 and make no plans/provision for it is horrendous advice.
        What on earth do you expect them to do? Continue the fear mongering so many newbies are doing? They do not give you business advice and they do not run your company. They are quite correct that nothing changes for you until 2020 so you continue to use their services as BAU. They do not know what the changes will be and are not there to advise you on what to do with your business. Imagine your post if they tell you to go perm and 12 months later nothing happens?
        All accountants will be the same I imagine, hoping something changes to save their business model's, they must know they are ****ed.
        Rubbish. They don't know anything about the changes and nor do we. If you want to screw up your business model by planning to go brolly for no reason then do so. Don't get upset if the professional companies that have been through this a few times don't.

        That post is to try and calm the fears of the clueless newbies, not stoke it.

        You are being a bit ridiculous here if you don't mind me saying.
        'CUK forum personality of 2011 - Winner - Yes really!!!!

        Comment


          #5
          The difficulty is that no-one knows what we should actually be planning for.

          At the moment there is no indication of how this will work in reality. There is a consultation to under take and HMG have said that they need to "refine the design of the reform" in reference to the PS roll out last year.

          They have also conceded that HMRC must improve the CEST including referring to MOO, how it adresses multiple contracts and the overall lanaguage used.

          They have said they need to look at how HMRC responde to a lack of reasonable care, i.e. imposition of blanket deternminations of status. At the moment there are consequence for outside status decision but nothing for blanket inside decisions.

          They also need to look at an appeals process for IR35 status decisions where process has not been followed or incorrectly applied.

          None of this will be known untill the draft finance bill 2019, at which point we might actually be able to make plans.

          So, yes, it really is business as usual untill then because until then we won't know what's changed and what we have to plan for.

          Budget 2018: Private sector contractors face devil in the off-payroll rules’ detail
          "Being nice costs nothing and sometimes gets you extra bacon" - Pondlife.

          Comment


            #6
            I concur with DaveB's point of view.

            Comment


              #7
              I imagine there are more contractors in the private sector that are in denial regarding IR35 already applying to them.

              Comment


                #8
                Originally posted by northernladuk View Post
                How do you know it's an industry changer? And if it is what will be the changes? Pain in the ass in Public Sector yes but there are plenty of outside people still working there. Look back to the day after the PS were announced a few years ago and a ton of newbies were wailing about the end of contracting in the PS and it's not. SJD and many of the other accountants have been through this time and time again and the arse hasn't fallen out of anything yet.

                I did say I was cynical, I always assume worst case scenario, I know from the rather large Investment Bank that I work for that they will almost certianly blanket inside IR35 for the majority of us (and rightly so) as they have done when similar contracting law changes have happened in the USA and Germany. All the banks will take the least risk option and I think it is safe to assume that, I am speaking specifically from an IB perspective as they are the largest contractor market in the south east.

                Way to go you for planning to lose 20% of your income when you've no idea what's going to happen. Let's see if you do it or not hey. Oh.. And you think ER will still be available then?

                I had been wanting to shut down and use ER to get the funds out of my biz account (which are substantial...) so this isn't a bad excuse to do it anyway, and yes I do think ER will be available until April 2020, why would it not be? If Hammond wants to screw ER he would have to do it in the next budget, regardless I will claim it before anything takes effect anyway.


                What on earth do you expect them to do? Continue the fear mongering so many newbies are doing? They do not give you business advice and they do not run your company. They are quite correct that nothing changes for you until 2020 so you continue to use their services as BAU. They do not know what the changes will be and are not there to advise you on what to do with your business. Imagine your post if they tell you to go perm and 12 months later nothing happens?

                I don't expect them to say it's business as usual, because it's bloody well not. That's tulip advice.


                Rubbish. They don't know anything about the changes and nor do we. If you want to screw up your business model by planning to go brolly for no reason then do so. Don't get upset if the professional companies that have been through this a few times don't.

                It's being risk averse, use ER, take the money, go brolly, get the lay of the land for 2 years, spin up again if appropriate. I don't see anything wrong with that.

                That post is to try and calm the fears of the clueless newbies, not stoke it.

                You are being a bit ridiculous here if you don't mind me saying.
                No, I don't think I am, cynical and somewhat negative yes, but it's served me very well, it isnt going to change now.

                Comment


                  #9
                  Originally posted by splitbrain View Post
                  I did say I was cynical, I always assume worst case scenario, I know from the rather large Investment Bank that I work for that they will almost certainly blanket inside IR35 for the majority of us (and rightly so) as they have done when similar contracting law changes have happened in the USA and Germany. All the banks will take the least risk option and I think it is safe to assume that, I am speaking specifically from an IB perspective as they are the largest contractor market in the south east.
                  We'll see. I'd have thought banks and IB would have been willing to put the effort in as it's all about making money. They might be afraid of the risk but when the other option is lose resources on critical systems and business cases don't meet I would have thought they'd have been swayed.

                  IR35 for the majority of us (and rightly so)
                  Why do you say this. You consider yourself inside do you?

                  I had been wanting to shut down and use ER to get the funds out of my biz account (which are substantial...) so this isn't a bad excuse to do it anyway, and yes I do think ER will be available until April 2020, why would it not be? If Hammond wants to screw ER he would have to do it in the next budget, regardless I will claim it before anything takes effect anyway.
                  We'll see. I can't imagine he has missed the point that everyone will try this when his changes hit. Maybe it's me being cynical now

                  I don't expect them to say it's business as usual, because it's bloody well not. That's tulip advice.
                  It's factual and it's correct. You will continue to use your accountant between now and any changes exactly as you have. Your core business between your client and you might change but that is none of the accountants business.

                  It's being risk averse, use ER, take the money, go brolly, get the lay of the land for 2 years, spin up again if appropriate. I don't see anything wrong with that.
                  It's plan based on too many unknowns and nothing more than a knee jerk reaction. We knew this was coming 2 years ago but still everyone is predicting the world end. It's an option yes. You are making out it's a given, which it isn't.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

                  Comment


                    #10
                    My advice to you would be sack SJD off. I mean, you're paying the earth of a service that is well known to be getting worse and isn't using market leading book keeping software.

                    I'd suggest you sign up with Gorilla Accounting and I'll split the referral fee with you to try and reduce the hit of the brolly payments when they hit.

                    Can't say fairer than that can I?
                    'CUK forum personality of 2011 - Winner - Yes really!!!!

                    Comment

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