IR35 Insurance

[xoggoth]

Hmmm. Above makes it sound like the HMRC always make rational decisions based on effort vs tax recoverable.

Wonder if there is not also some random element in these things, they pick you out of a hat. If they only ever investigated major prospects then everyone would feel safe avoiding a few k. Seem to recall reading a while ago that they spend about twice what they recover investigating the self employed.

[Qdos Contractor]

If you are clearly and catagorically outside IR35, then why fear an investigation?

That is an innocent question by the way, and yes I did recently have my contract and working practices reviewd by Qdos.

Because, insured or not, being subject to an enquiry is never nice. With IR35, in can take three years to prove your innocence and I can't even begin to imagine what the stress is like for clients, even when we are dealing with HMRC.

[Qdos Contractor]

Meaning that it's possible to take out TLC35 on less than £9.5k? Perhaps just more expensive?

No, that's incorrect. For TLC the salary has to be above £9.5k.

Freelancer Tax Protection, which is representation cover, does not require any set salary level.

[Hiram King Of Tyre]

Because, insured or not, being subject to an enquiry is never nice. With IR35, in can take three years to prove your innocence and I can't even begin to imagine what the stress is like for clients, even when we are dealing with HMRC.

I really can't imagine why it would take that long if your accounts and working practices are clearly outside though.

If you're eventually proved innocent, do you get any costs back?

[Qdos Contractor]

I really can't imagine why it would take that long if your accounts and working practices are clearly outside though.

If you're eventually proved innocent, do you get any costs back?

They take so long because a) the Revenue go into a huge amount of detail and b) they are incredibly slow to respond. IR35 enquiries are rarely short. I am dealing with one case that started as a PAYE review over two years ago and the Revenue have only just kicked off a specific IR35 enquiry.

You get nothing back, which is why representation insurance is so worthwhile.

[malvolio]

They take so long because a) the Revenue go into a huge amount of detail and b) they are incredibly slow to respond. IR35 enquiries are rarely short. I am dealing with one case that started as a PAYE review over two years ago and the Revenue have only just kicked off a specific IR35 enquiry.

You get nothing back, which is why representation insurance is so worthwhile.

PCG's latest win just came through. It's been running for six years... The guy is taking Christmas off to get drunk . We'll get the full story next year, but can you imagine having that kind of threat over your head for that long?

That's why PCG are kicking off a campaign to get HMRC subject to a duty of care - what they do and how they do it is currently indefensible.

[Lewis]

PCG's latest win just came through. It's been running for six years... The guy is taking Christmas off to get drunk . We'll get the full story next year, but can you imagine having that kind of threat over your head for that long?

That's why PCG are kicking off a campaign to get HMRC subject to a duty of care - what they do and how they do it is currently indefensible.

[pisces]

That's not why we set the minimum level. We are simply looking to minimise the risk of enquiry for contractors. There is no hidden agenda.

A salary between £9.5k and £15k will increase the standard excess from £250 to £500. £15k is optimum and is considered an acceptable level of salary for industries across the board.

As Darren states, it does not have any direct implications on IR35, but with a policy worth £100k plus we need to satisfy underwriters that we are not taking undue risk.

Fact is, anyone that satisfys your criteria doesn't need the insurance in the first place.

[exbrm]

No-Brainer .......

We don't keep statistics to that degree. However, we have successfully defended over 1000 IR35 enquiries and a significant number of those involved directors who took low salary payments.

For obvious reasons the Revenue prefer enquiring into contractors who would be subject to the highest tax loss. This means that when, reviewing P35s, they will opt for those with nominal payments rather than a 'reasonable' level. It's a no-brainer for them.

Thanks Qdos for the free advice. Pitty the No-Brainer bit does not sink in with some.

[Lewis]

Fact is, anyone that satisfys your criteria doesn't need the insurance in the first place.

Well, I wonder if you would say that after a 3 year IR35 investigation which you had to deal with all on your own You might relish the chance to take on all the work a case involves (even when innocent) but I and many others don't. This insurance provides great peace of mind!!