Inside IR35 tax Liability

[Keanu2020]

In short, slowly.

Spoke with WTT and grateful for the time invested, but they got to the same place my accountant did. Which is I was ‘fortunate’ to a certain extent that it was discovered early. It means the tax bill due and what I would have had to pay through my ltd net out to about the same. So advice was kind of “your no worse off and chalk up to experience”. With the sum I’m owed not being massive as well, suspect for any advisors there is no major payday from resolving. Like I said, lucky found it early.

But it is still wrong. And I have been trying to resolve.

I tried HMRC but frankly its ridiculous. I have chat logs from their online help stating wildly different positions and answers from people there, some worse. They don’t respond in any meaningful timeframe. And the last response was along the lines of “share with us all your personal financial information from every source and we will see how we can help you”. Thanks, but I will pass on the kind offer of an unrequested investigation. I guess, no surprise, there sole concern is they might be able to collect more tax from someone, not that the right person paid it in the first place.

The general consensus is that this is not how it’s meant to work, but its near impossible to get clarity. One person who is well connected is trying to help me, and I’m grateful, but its very slow going for them with no clear answer yet either.

I think more people down the line are going to get hit with a much large bill (think 16 to 20 months inside) and it going to be life changing sums with no help or guidance anywhere on how to resolve.

Can I ask what made you ask for an update? Similar issue?

[simes]

Can I ask what made you ask for an update? Similar issue?

Thanks for that.

In the State of the Market thread, I mentioned having recently started an Outside gig and someone commented that I 'must be brave'. Even though I was thinking an Outside gig was what everyone was looking for.

And then someone else found an Outside gig and linked your situation to what inspired the 'brave' comment.

Gulp! So, it is the clients' responsibility, unless they've made a mistake. And then it again reverts to being your responsibility. That it?

[Keanu2020]

Pretty much.

I begin questioning why anyone would contract outside if that’s the risk and you have no control over the determination at all.

Current role is illuminating where I see recruiters (it’s a large firm) clearly doing no real checks and just saying the roles can be outside in advice to client, mainly as it’s a competitive market and need to do this to attract people. The Client (having taken external advice!) and this is where it gets odd, are told if caught breaking the rules on IR35 it’s just an £8K to £10K fine, not the tax. The rush to attract talent, business pressures, bad advice, you can see why there are more outside roles.


Everyone seems to think it should be the hirer (client) that is responsible for the missing tax, but try finding that laid out clearly, particularly with reference to fixing an issue that may have been running for months / years.

[simes]

Good grief!

And the HMRC were of no help in clarifying to the client it is their responsibility, bearing in mind it is their legislation?

Ok, I see eek's point now. Thanks for that.

[Keanu2020]

With HMRC, it is hard enough to get an answer, and when I do get one, it changes each time. It has been close to 5 months now and pretty much given up on getting an answer from HMRC. The current solution is based on (I believe wrong) advice given to the client and their recruitment agent direct from HMRC. As you say, it is their legislation as well.