Accountax

[ruth11]

I don't think the stats can be that skewed.
Surely the majority of contractors get their contracts all checked out.
If the contracts say outside, then they would have fair chance of success at appeal and therefore would be taken on by PCG\QDOS. Right?

In QDOS' case, you can't get their insurance if the WP don't put you outside. What they're saying is that if your WP are outside and you therefore have their insurance, they will fight for you. If it turns out you lied on your WP assessment, then maybe they would tell you your insurance is worth squat, but why would you lie? You know you're going to invalidate the insurance and you're just wasting your money.

[tim123]

If I am, why is it going to appeal then? You can only appeal the commissioners where they have failed to apply the existing case law correctly - you don't have to exercise substitution to prove you have the right to do it.

Because they think that overall ruling was wrong. This doesn't necessarily mean that there was already some case law that was ignored. If you are appealing against a ruling in Law, it could be with reference to a previously untried set of facts, otherwise there would never be any new case law. Or you can (in extreme cases) appeal a ruling in Fact.

And no, you don't need to exercise a subs clause for it to be valid, but common sense says that it has to be "exercisable" for it to be valid, and there is no case law that says otherwise.

The only binding case law on substitution is Taunton, and in that case the right *was* exercised. The other examples that had a fettered right of substitution were ones where other factors already pointed to "outside IR35" and the fettered RoS, at best, helped put it over the line and, at worse, was irrelevant.

I believe that there is no case where a fettered RoS was conclusive on its own and I challenge you to find one. Until you do, your claim that the judge ignored established case law is unproven, at best.

ISTM there is a school of thought, within the 'IR35 Industry', that having a RoS in the contract, that cannot be exercised in practice because an appropriately skilled person does not exist, is enough to satisfy Taunton (and I know this because I remember it being discussed in another place when the first "how do we get out of IR35" moves were being discussed). Could this appeal be an attempt to prove this?

I can't agree with that view. To satisy Taunton you have to actually have an exercisable RoS and if this appeal is being conducted on this point (which it might not be) IMHO it is doomed to failure.

In order to avoid this speculation it would be nice to know what the basis of the appeal is, but I doubt that I will find out before we get there.

tim

[tim123]

I don't think the stats can be that skewed.
Surely the majority of contractors get their contracts all checked out.
If the contracts say outside, then they would have fair chance of success at appeal and therefore would be taken on by PCG\QDOS. Right?

As there are tens of thousands of contractors working through brollies because they "can't be bothered to find out", I would guess that there must be tens of thousands working through Ltds who also "can't be bothered to find out".

Some of the latter are probably "ticking the outside IR35 box" and just hoping to get away with it. (for the pedants I think the switch actually works the other way!)

There are (probably) 200,000 contractors in the UK, how many does the PCG/QDOS/TLC(?) represent?

10% perhaps. what are the other 90% doing?

tim

[Archangel]

therefore would be taken on by PCG

All PCG members are covered regardless of whether the contract has been reviewed or not, found inside or outside, etc etc

[ruth11]

As there are tens of thousands of contractors working through brollies because they "can't be bothered to find out", I would guess that there must be tens of thousands working through Ltds who also "can't be bothered to find out".

Some of the latter are probably "ticking the outside IR35 box" and just hoping to get away with it. (for the pedants I think the switch actually works the other way!)

There are (probably) 200,000 contractors in the UK, how many does the PCG/QDOS/TLC(?) represent?

10% perhaps. what are the other 90% doing?

tim

Then you're asking the wrong people. QDOS and the PCG cannot possibly know how many contractors there are out there who are just blindly ticking the "outside" box and hoping, because they probably aren't members\customers and will never seek their advice, even in the event of an investigation! This would mean that HMRC may well have different win\loss figures to these companies\organisations, but that doesn't make their figures wrong.
Those who are working inside IR35 are irrelevant to this discussion because they are paying the tax and therefore will never get investigated!

[ruth11]

All PCG members are covered regardless of whether the contract has been reviewed or not, found inside or outside, etc etc

Then their win\loss figures really cannot be misleading in any way.

But as I say above, you can't compare those figures to the HMRC figures of win\loss, because you don't know how many go through without representation and just pay up. And as far as I'm concerned, they're irrelevant to me because they're not bothering to try to protect themselves sufficiently.

[Archangel]

Then their win\loss figures really cannot be misleading in any way.

But as I say above, you can't compare those figures to the HMRC figures of win\loss, because you don't know how many go through without representation and just pay up. And as far as I'm concerned, they're irrelevant to me because they're not bothering to try to protect themselves sufficiently.

I agree with you 100% (my post was just trying to clarify the PCG position)

[malvolio]

Big snip...

In order to avoid this speculation it would be nice to know what the basis of the appeal is, but I doubt that I will find out before we get there.

tim

We're way off topic here, but afaik, and I could well be wrong, the case involving Anax imperator centres on the client repudiating the terms of his signed contract - which included the RoS clause that would have passd the "unfettered" test

[THEPUMA]

In order to avoid this speculation it would be nice to know what the basis of the appeal is, but I doubt that I will find out before we get there.

There are 4 grounds to the appeal, of which one relates to substitution and one to control. The other 2 are a bit more contentious and I probably shouldn't mention them here.

[ASB]

And no, you don't need to exercise a subs clause for it to be valid, but common sense says that it has to be "exercisable" for it to be valid, and there is no case law that says otherwise.

I see this thought train. And worryingly I agree with it.

The question then becomes what makes it exercisable ?

A simple answer might be "you're a one man band, ergo it is not". That would be dangerous in my view but does seem to be the way some thought is going.

We always had sub clauses, we were also a one man band. Does that make them unexercisable. Of course not. If we wanted to send a sub, we would try and find one. (and on a number of occasions we did farm work out).

It seems to me that the presence of clauses in a contract is no longer relevant. If they are not exercised the commissioners are simply going to infer what the client says they would demand - provided it is not totally incompatible with the lower contract.

The bar for exercisable now seems to be "actually happened". Barking in my view.