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

[rootsnall]

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.

Well IR35 has been going a long time so there is some body of evidence to support the theory that it won't happen. Is my understanding correct that they'd have to prosecute you for fraud through the courts before they could then ask you to pay them anything ? So they'd have to open an IR35 investigation into the defunct Ltd Co, fight the case and win it, and then get the CPS to prosecute you for Fraud and win that case. I suppose they could pick on a few examples !? ( this is just me guessing and thinking out loud by the way )

[eek]

Well IR35 has been going a long time so there is some body of evidence to support the theory that it won't happen. Is my understanding correct that they'd have to prosecute you for fraud through the courts before they could then ask you to pay them anything ? So they'd have to open an IR35 investigation into the defunct Ltd Co, fight the case and win it, and then get the CPS to prosecute you for Fraud and win that case. I suppose they could pick on a few examples !? ( this is just me guessing and thinking out loud by the way )

It doesn't need to be a criminal case - neglect of care / duty can be enough if you are a director see The Finance & Tax Tribunal

The legislation under which a Personal Liability Notice can be raised, namely s121C(1)(a) and (1)(b) of the SSA Act 1992 requires there to have been;

• a failure to pay the contributions due;
• evidence that the failure was attributable to the fraud or neglect of one or more individuals;
• evidence that the individual was an officer of the company at the time of the failure

[jamesbrown]

Well IR35 has been going a long time so there is some body of evidence to support the theory that it won't happen. Is my understanding correct that they'd have to prosecute you for fraud through the courts before they could then ask you to pay them anything ? So they'd have to open an IR35 investigation into the defunct Ltd Co, fight the case and win it, and then get the CPS to prosecute you for Fraud and win that case. I suppose they could pick on a few examples !? ( this is just me guessing and thinking out loud by the way )

Lack of reasonable care is sufficient, in principle. On the whole, it has been thought too high a barrier when you have a contract review and some evidence of WPs; essentially, due diligence. Now the client may be saying all of that was pap. It's probably still too high a bar, but it might not be at the margins (e.g., if the contractor had self-assessed in a cursory way).

[rootsnall]

It doesn't need to be a criminal case - neglect of care / duty can be enough if you are a director see The Finance & Tax Tribunal

Thanks. That's useful to know.

Just had a quick read and in that case they were showing quite a bit of 'neglect' :-) An accountant who knew the Ltd owed NICS and ignored demands and paid himself money before the Ltd folded. A dodgy geezer me thinks. Still good to know.

[ruprechtmonboy]

Hello all, after a bit of advice.

Been contracting through ltd co for the past 2.5 odd years. History goes like this:

Did 18 months at client 1 on a specific software project
Left and then spent 3 months at client 2
Left client 2 and returned to client 1 to a different team than original and worked for 6 months on another project
Beginning of this year took a new contract at client 1 again in different team and area working on other projects

Line manager at client 1 has been different for each contract and job title is different from first 18 months.

Client 1 have now offered me an inside contract.

Am I right in thinking that HMRC can only open an investigation for a single contract at any one time?
Also, as I have moved teams/areas in client 1 and worked at client 2 last year I am thinking that compared to a contractor that has sat in the same role for years I am in a less risky position if I decide to take the inside option?

Any thoughts would be welcome.

Cheers

[eek]

Hello all, after a bit of advice.

Been contracting through ltd co for the past 2.5 odd years. History goes like this:

Did 18 months at client 1 on a specific software project
Left and then spent 3 months at client 2
Left client 2 and returned to client 1 to a different team than original and worked for 6 months on another project
Beginning of this year took a new contract at client 1 again in different team and area working on other projects

Line manager at client 1 has been different for each contract and job title is different from first 18 months.

Client 1 have now offered me an inside contract.

Am I right in thinking that HMRC can only open an investigation for a single contract at any one time?
Also, as I have moved teams/areas in client 1 and worked at client 2 last year I am thinking that compared to a contractor that has sat in the same role for years I am in a less risky position if I decide to take the inside option?

Any thoughts would be welcome.

Cheers

Has the contract been determined to be inside or is it due to a blanket ban?

HMRC will look at all contracts and decide which ones are worth looking into further and all from client 1 would probably be treated as worth investigating.
And with 85% of your time at a single client which you then went agreed was inside I think HMRC would have a justifiable argument that you were inside all the time.

[ruprechtmonboy]

Has the contract been determined to be inside or is it due to a blanket ban?

HMRC will look at all contracts and decide which ones are worth looking into further and all from client 1 would probably be treated as worth investigating.
And with 85% of your time at a single client which you then went agreed was inside I think HMRC would have a justifiable argument that you were inside all the time.

It's been determined inside.

I thought as each of the three contracts at client 1 have been in different teams/areas with differing cost centre codes, etc is evidence they weren't the same. i.e. I haven't been sitting in the same team for the entire time doing one role.

Does that make sense?

[eek]

It's been determined inside.

I thought as each of the three contracts at client 1 have been in different teams/areas with differing cost centre codes, etc is evidence they weren't the same. i.e. I haven't been sitting in the same team for the entire time doing one role.

Does that make sense?

Do you have QDOS or similar contract reviews for every one of those contracts?

If not you are little different from a Permanent member of staff being seconded around departments as appropriate (and that happens all the time for IT people).

[ruprechtmonboy]

Do you have QDOS or similar contract reviews for everyone of those contracts?

If not you are little different from a Permanent member of staff being seconded around departments as appropriate (and that happens all the time for IT people).

No I don't.

So I take it making the switch to perm would also be a risk and flag to HMRC?

[LondonManc]

This Tweet doesn’t bode well for some...

https://twitter.com/kenbarnett15/sta...441963009?s=21