IR35: Planning for April 2021 – should I stay or should I go?

[northernladuk]

I’m working Ltd up to the end of March and still no idea what to do next… Current client is blanket ban/Inside so do I:

Move to Umbrella and have my NI contributions go up and possibly get a letter from HMRC?
Move to Perm and have my NI contributions go up and possibly get a letter from HMRC?
Have time off and then get an Umbrella/Perm and have my NI contributions go up and possibly get a letter from HMRC?

Seems like the only way to avoid any targets on your back is to find an outside role at a small company or just have time off indefinitely?

Seems a fair summary of your options so need more options around leaving

[mikedarv]

Seems a fair summary of your options so need more options around leaving

Mentioned a while ago in another thread about the client dishing out Umbrellas and Perms all over the shop and I'd say 90% have no idea of the implications of staying on in the same role.

If I at least suggest to get IR35 insurance is there even a case to defend for those moving from the same inside role straight to an umbrella?

[northernladuk]

Mentioned a while ago in another thread about the client dishing out Umbrellas and Perms all over the shop and I'd say 90% have no idea of the implications of staying on in the same role.

If I at least suggest to get IR35 insurance is there even a case to defend for those moving from the same inside role straight to an umbrella?

If you've not got it already I doubt it's going to be any use to you.

[mikedarv]

Presumably most people moving to umbrella/perm will be closing their Ltd company as soon as possible.

So if a letter arrives asking the client (the Ltd company) to pay back employer's NICs and that Ltd has no assets and no longer exists...?

[CompoundOverload]

Presumably most people moving to umbrella/perm will be closing their Ltd company as soon as possible.

So if a letter arrives asking the client (the Ltd company) to pay back employer's NICs and that Ltd has no assets and no longer exists...?

If it's an outside to inside transition same client and you're deemed as inside throughout the engagement, assuming the company upon closure is not investigated, then expect to remortgage house and sell assets at a later date as the liability falls onto the director of the company.... HMRC can still open investigations on closed companies after the event. If you have insurance, at least run that a year or two after the LTD is finished.

[iamirv]

If you've not got it already I doubt it's going to be any use to you.

Could you explain why it would matter when you got IR35 insurance? Is it not the case that if it's in place prior to an investigation, any legal and potential penalty fees would be covered? Thanks

[northernladuk]

Could you explain why it would matter when you got IR35 insurance? Is it not the case that if it's in place prior to an investigation, any legal and potential penalty fees would be covered? Thanks

Whixh is why I said if you've not got it getting it now may not help. If you get it now when your client is going to put you inside it's a big ask of the insurance company to then cover you. You won't be able to buy flood insurance if you live on a flood plain and a storm is on its way in.
It's not there to cover you for imminent risk that would affect your position.

[rootsnall]

If you've not got it already I doubt it's going to be any use to you.

If somebody is prepared to sell it you on the premise that is covers backdated contracts then I don't see why it would be any less useful than having held it long term ? Guess it depends on the wriggle room the provider has in either scenario.

[rootsnall]

If it's an outside to inside transition same client and you're deemed as inside throughout the engagement, assuming the company upon closure is not investigated, then expect to remortgage house and sell assets at a later date as the liability falls onto the director of the company.... HMRC can still open investigations on closed companies after the event. If you have insurance, at least run that a year or two after the LTD is finished.

HMRC would have to prove you had committed fraud to go down this route. Have you any evidence of this ever happening ?

[jamesbrown]

HMRC would have to prove you had committed fraud to go down this route. Have you any evidence of this ever happening ?

There's no evidence. But there's also no historical analogy to the present situation, so it doesn't mean the speculation is wrong w/r to what might happen.