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So, would I be inside IR35

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    So, would I be inside IR35

    A potential contract has surfaced, but with the recent IR35 win\loss threads I’m now thinking that it may well be inside IR35. I’m not going to dismiss the opportunity if it is inside, I’ll just look for a higher rate.

    Spec is:

    Consulting role, relating to specific knowledge of network management software.
    The role will mainly be working on projects, with no D&C on how my project work is accomplished.
    The position is part of a small networks team, filling a knowledge gap.
    There will be some other work (support-type), when specific production issues are escalated from an operations team (reading the judgement from the recent HMRC IR35 win, this is one of the main things that’s concerning).
    I’ll be on a daily rate.
    I will not bill for time if there is no work.

    There may also be contract issues as it seems the preferred agency is rather inflexible with contract amendments (Elan).

    What’s the consensus, inside or out?

    #2
    Originally posted by Spoiler View Post
    A potential contract has surfaced, but with the recent IR35 win\loss threads I’m now thinking that it may well be inside IR35. I’m not going to dismiss the opportunity if it is inside, I’ll just look for a higher rate.

    Spec is:

    Consulting role, relating to specific knowledge of network management software.
    The role will mainly be working on projects, with no D&C on how my project work is accomplished.
    The position is part of a small networks team, filling a knowledge gap.
    There will be some other work (support-type), when specific production issues are escalated from an operations team (reading the judgement from the recent HMRC IR35 win, this is one of the main things that’s concerning).
    I’ll be on a daily rate.
    I will not bill for time if there is no work.

    There may also be contract issues as it seems the preferred agency is rather inflexible with contract amendments (Elan).

    What’s the consensus, inside or out?
    No idea without seeing the contract. As good as the working conditions may be, a contract that places you squarly inside IR35 will be indefensible IMHO, even if you can show that your working practices could be classified as outside IR35.

    The first part to being outside IR35 is the contract (with recent judgements it would appear the contract between the client and agency is being used as a main factor in recet losses). If you get this part sorted out you then need to worry about working conditions.

    Hopefully these two recent losses will be appealed against though, the logic in the latest loss is very skewed IMHO. The SC has ignored evidence presented to him because he doesn't believe it.... I would say you probably only have an IR35 issue if mr Hellier is judging your case at this moment in time.

    Comment


      #3
      Originally posted by Spoiler View Post
      A potential contract has surfaced, but with the recent IR35 win\loss threads I’m now thinking that it may well be inside IR35. I’m not going to dismiss the opportunity if it is inside, I’ll just look for a higher rate.

      Spec is:

      Consulting role, relating to specific knowledge of network management software.
      The role will mainly be working on projects, with no D&C on how my project work is accomplished.
      The position is part of a small networks team, filling a knowledge gap.
      There will be some other work (support-type), when specific production issues are escalated from an operations team (reading the judgement from the recent HMRC IR35 win, this is one of the main things that’s concerning).
      I’ll be on a daily rate.
      I will not bill for time if there is no work.

      There may also be contract issues as it seems the preferred agency is rather inflexible with contract amendments (Elan).

      What’s the consensus, inside or out?
      It's pointless asking us whether you would be in or out. It all depends on :

      The lower contract terms being ir35 compliant
      The upper contract terms reflecting the lower contract terms as ir35 compliant.
      The working practices reflecting both the above.
      The general context of how you run your business as a whole which can be persuasive in swinging the pendulum for and against in an otherwise neutral status based on the terms and working practices. The HMRC website has some good fictious models of what they would regard as in and out, and many of them relate to IT contracting companies. Use those as your guide.

      All of them are important in deciding a case. The checklist tickbox approach has been criticised by the courts as being the wrong way to ascertain ir35 compliance.

      All I would say is this: do your contract term negotiating early on and get as much in writing as possible from the EB - confirming upper contracts reflecting lower ones etc and write out how you want your company to be reflected in the upper contract (I gave an example yesterday on this forum). Do not assume that the lower contract review status from a legal adviser is enough to put you outside and then go to work assuming that is all is well and you can behave like the employees. Chances are you will be OK as investigations are still few and far between compared to the number of businesses that are out there, but it seems that you are worried enough now to move away from this way of approaching the gig. Make sure you have adequate PAYE review and ir35 insurance in place just in case the beastie buff envelope does drop on your doormat.

      I said some time ago on this forum that Ir35 was far from dead as well as far from unsuccessful, and that contractors should be wary about posts both on here and on the PCG claiming that it was dead and that is a voluntary tax and all such nonsense. Malvolio has posted this rubbish too, much to my dismay. Just because it should be dead and we want it to be dead that doesn't mean that it is - hence these recent losses and victories.
      Last edited by Denny; 17 January 2008, 12:28.

      Comment


        #4
        Originally posted by Denny View Post
        ..snip...
        I said some time ago on this forum that Ir35 was far from dead as well as far from unsuccessful, and that contractors should be wary about posts both on here and on the PCG claiming that it was dead and that is a voluntary tax and all such nonsense. Malvolio has posted this rubbish too, much to my dismay. Just because it should be dead and we want it to be dead that doesn't mean that it is - hence these recent losses and victories.
        I didn't ever say it was dead, I did say it was voluntary, because the conditions are well-enough known for you to build an outside IR35 contract and working relationship. If you don't (or can't, becuase you lack the negotiating muscle to do so for some reason), you will get caught. There are, however, a signficcant number of people using brollies or paying IR35 because they can't be bothered to stay out of it. That makes it successful in HMRC's eyes, it doesn't make it right.

        Reading the recent judgements, they are all entirely consistent with that view and the people that lost did so because for various reasons they did not follow the model. Plus one of the losers could quite probably have won, albeit marginally, had they had proper representation.

        It's worth noting these recent ones were SC cases. Hector would not have gone to the Specials if they didn't have a reasonable chance of success, which is why the win/loss ratio at this level is so poor. 98% of IR35 challenges reported to the PCG are abandoned before they go to the commissioners.
        Blog? What blog...?

        Comment


          #5
          Denny in the blue corner, and Malvolio in the red...... round 45869...
          cut me - ill bleed rosso red

          Comment


            #6
            Originally posted by malvolio View Post
            I didn't ever say it was dead, I did say it was voluntary, because the conditions are well-enough known for you to build an outside IR35 contract and working relationship. .
            By saying it is a 'voluntary tax' you are implying that there is no need or worry to bother paying it and that is really just up to the individual to determine just how risk averse they are rather than assess, with or without professional advice, what they should pay in tax depending on the circumstances of the contract and working practices. In other words paying up is like contributing to a charity. You do it becuase you want to. That's what 'voluntary' means. Clearly, this isn't the case.

            I would also suggest that it is not 'well known enough to build an outside ir35 contract and working relationship' as you put it. If that were the case, then no victories would be won by HMRC because there would be clear guidelines to follow and contractors would have complete control over their terms and working practices to reflect these self determined contracts. The reality is this: too many determinants are present that are clearly beyond the control of the contractor to 'build an outside ir35 contract' if they are using EBs particularly. Your stance, therefore, is precisely the view of the HMRC who seem to suggest, by this recent victory of theirs, that for contractors to be safely outside ir35 to their own satisfaction contractors must work in field that give them complete autonomy and control over how they set up their contracts and how they work in practice because they don't have to report to anyone or work in teams. So you've scored an own goal there.

            The PCG have also been running threads and allowing posts from members categorically stating that ir35 is dead. No attempt has been made by the mods to remove these misleading posts. Yet they harp on about nasty comments and bullying behaviour as needing more serious intervention for removing such posts. Clearly, warped priorities, I suggest, because members need to be furnished with helpful and constructive information not read the commentaries of fly by night fllibbertigibbets who want to post blase falsifications that stoke the HMRC's fire and stroke their own enterprise business orientated egos whilst they're at it just for their own amusement and at the expense of everyone else who posts on there and who represent the bulk of the freelancing community.
            Last edited by Denny; 17 January 2008, 13:32.

            Comment


              #7
              Originally posted by poser View Post
              Denny in the blue corner, and Malvolio in the red...... round 45869...
              Hopefully I've just delivered a knock out blow in my latest post.

              Comment


                #8
                Originally posted by Denny View Post
                It's pointless asking us whether you would be in or out. It all depends on :
                At the present moment I'm not concerned with the contract side. I believe this side of it is clear, either the upper\lower contracts are fine for positioning one outside, or they aren’t.

                My current concern is with the actual working practices. Having read the recent judgements it looks like the ones I will be working to are a little greyer than I first thought.

                As is usually posted on this fora, the contract is important, but it's just a pointer to IR35 status. It’s the working practices that are really important.

                Thanks for the pointer to the HMRC guides. I’ll take a look.

                Comment


                  #9
                  Originally posted by Spoiler View Post
                  At the present moment I'm not concerned with the contract side. I believe this side of it is clear, either the upper\lower contracts are fine for positioning one outside, or they aren’t.

                  My current concern is with the actual working practices. Having read the recent judgements it looks like the ones I will be working to are a little greyer than I first thought.

                  As is usually posted on this fora, the contract is important, but it's just a pointer to IR35 status. It’s the working practices that are really important.

                  Thanks for the pointer to the HMRC guides. I’ll take a look.
                  I would be asking myself, am I there doing a permie's job and just doing whatever they ask me to or do I have some specific deliverables that I must meet to get paid?
                  Don't ask Beaker. He's just another muppet.

                  Comment


                    #10
                    Originally posted by beaker View Post
                    I would be asking myself, am I there doing a permie's job and just doing whatever they ask me to or do I have some specific deliverables that I must meet to get paid?
                    That's my concern. Mostly specific project deliverables, but with the possibility of picking up operational issues as & when they occur. If this last bit is deemed inside, then it would seem that anyone that gets involved in any kind of support issue may well be looked on as inside IR35.

                    Comment

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