A Sad “IR35” Day

[Peoplesoft bloke]

just done this myself. If you're on good terms with the client simply state in light of your decision I have found an opportunity elsewhere which is outside and I have advised them I'm starting in two weeks. I hope you don't mind.

Exactly what I've done (except 4 weeks notice as per contract)

[ladymuck]

I wouldn't close down just because you've had a long term client. Just carry on trading

[BABABlackSheep]

You can't MVL if you remain in business doing the same thing.

It's fine to MVL if going permanent.

Probably fine (with some small proviso's regarding returning to contracting within 2 years) if you go via an umbrella.

A complete no no to use ER if you are starting up again immediately.

Go permie, go umbrella, no difference to MVL. Same 2 year rule after closure.

If I go back Umbrella it’s 2 years from closure, then if I get an outside role, I’ll start another ltd.

[BABABlackSheep]

I wouldn't close down just because you've had a long term client. Just carry on trading

Usually. Just tempted to get the cash out before they change the ER rules. Coupled with long term client = decision to be made.

[eek]

Go permie, go umbrella, no difference to MVL. Same 2 year rule after closure.

If I go back Umbrella it’s 2 years from closure, then if I get an outside role, I’ll start another ltd.

Not quite - go Permie and if things change you can show that you intended to leave contract work and it just didn't work out.
go umbrella and that argument doesn't work

Maslin posted a very good reply about it yesterday but it is on a thread that seems to have been deleted.

The issue isn't really one of can I close my company, it was more how easy would it be to start it up again without bareface lying to HMRC.

[BABABlackSheep]

Not quite - go Permie and if things change you can show that you intended to leave contract work and it just didn't work out.
go umbrella and that argument doesn't work

Maslin posted a very good reply about it yesterday but it is on a thread that seems to have been deleted.

The issue isn't really one of can I close my company, it was more how easy would it be to start it up again without bareface lying to HMRC.

Clients are forcing contractors to go umbrella. Inside via PSC is not even an option for many.

Of course contractors are closing via MVL and I don’t believe for a second HMRC will stop people opening ltd in the future. Makes absolutely no sense and probably illegal.

[Lance]

A Sad “IR35” Day

Clients are forcing contractors to go umbrella. Inside via PSC is not even an option for many.

Of course contractors are closing via MVL and I don’t believe for a second HMRC will stop people opening ltd in the future. Makes absolutely no sense and probably illegal.

They won’t stop them. They’ll just want the tax, plus fines, plus interest, on what should, in their mind, have been a dividend payment.

[eek]

Clients are forcing contractors to go umbrella. Inside via PSC is not even an option for many.

Of course contractors are closing via MVL and I don’t believe for a second HMRC will stop people opening ltd in the future. Makes absolutely no sense and probably illegal.

My comment was related to re-opening a limited company and returning to contracting through a PSC within 2 years.

Easy to argue the permanent job fell apart and you had to go back contracting.
Far harder to say your umbrella contract fell apart and you returned to contracting using a limited company.

Semantics is everything here.

And HMRC won't stop you re-opening a company. What we are talking about here is HMRC chasing you for inappropriate claimed entrepreneur relief as you reopen a limited company.

And as I stated in my previous post Maslin had explained it far better than I did.

[BABABlackSheep]

My comment was related to re-opening a limited company and returning to contracting through a PSC within 2 years.

Easy to argue the permanent job fell apart and you had to go back contracting.
Far harder to say your umbrella contract fell apart and you returned to contracting using a limited company.

Semantics is everything here.

And HMRC won't stop you re-opening a company. What we are talking about here is HMRC chasing you for inappropriate claimed entrepreneur relief as you reopen a limited company.

And as I stated in my previous post Maslin had explained it far better than I did.

How many times have HMRC successfully claimed ER tax difference back on someone who has closed a limited company, gone umbrella for a few years and then started another ltd company?

[Amanensia]

How many times have HMRC successfully claimed ER tax difference back on someone who has closed a limited company, gone umbrella for a few years and then started another ltd company?

Never, as long as "a few years" > 2.