IR35 loses appeal case

[The Lone Gunman]

And therin lies the point, you can have all the clauses you want in the contract, if those clauses do not mirror actual working practices you may still be IR35 caught.

If you are being told what to do and when to do it, and you have to request time off, then you are a disguised employee and IR35 caught, regardless of what 'cunning clauses' you have in your contract. In an investigation you will loose.

A lot of this is about semantics and interpretation and franckly you are not helping.
We need a united front in the contract market and you pointing out people are, in your opinion, disguised employees undermines the cause.
Some of us believe that the rules for IR35 are manufactured. Constructed as a catch all for what HMRC considers to be indicative of a disguised employee.
The rules are manufactured from a traditional view of what an employee is and the rules are possibly valid but many of our industries are in no way traditional and need a different interpretation, possibly an exemption from this kind of examination.
It is very difficult for some of us to avoid IR35, particularly if our clients (and fellow contractors) insist that we fit the HMRC model.

I would love to work on fixed price work packages (I have done so for 6 months in 10 years), but the problem is that I work on dev packages from the ground up. Could you quote a fixed price when the requirements are not in place and even if they are they change?
When I accept a contract I know that there will be a number of tasks required to be done and I will be doing some of those tasks. Those tasks are dependant on the project stage and work from other teams being complete. It would be very easy to paint that as control.
At certain times there will be a need to coordinate with other teams to achieve delivery targets and there will be times when a lot of effort is required for any number of reasons. Because of this there are times when the client will not accept absence. You could interpret that as having to request holidays.
I would argue that it is my business to provide services to my client. Those services are agreed by the contract. When those services are provided is also defined by the contract. I am controled by the contract and holidays (if ever I take them during contract) have to be negotiated ex contract.

It is not as easy as HMRC state.
Please do us a favour and get with the mind set. IR35 is wrong. It is badly implemented.
If you are going to say people are caught, at least point out that it is only HMRCs opinion that makes them caught.

Sorry, I could rant on like this for days (and sometimes do).

[smalldog]

going back to my original point Im still of the opinion that a large number of factors are considered in IR35. I dont think this guy helped his cause by being with the same client for 7 years. Even if he was doing different roles etc for the 7 years it wouldnt have even got to court had he been there only 3 months.

Thats my opinion and nothing I have heard so far changes it......

[The Lone Gunman]

going back to my original point Im still of the opinion that a large number of factors are considered in IR35. I dont think this guy helped his cause by being with the same client for 7 years. Even if he was doing different roles etc for the 7 years it wouldnt have even got to court had he been there only 3 months.

Thats my opinion and nothing I have heard so far changes it......

Why should being with the same client for a long time be a bad thing? It is good business practice. All the things stated in the summary could be interpreted from another point of view.
Having a single customer, not looking for other contracts etc is good business practice as it reduces cost. No need to advertise, no travel costs and time off to secure new contracts etc.
There are any number of "legitimate" businesses that have preferred supplier status some of whome have exclusive contracts with their clients who are not regarded as part and parcel of their clients business.
For example: M&S have many suppliers who exclusively manufacture for M&S only. They only manufacture for M&S. They only manufacture what M&S want. They have to deliver to M&S targets.
Why then are those businesses not regarded as part and parcel of M&S?

[smalldog]

Why should being with the same client for a long time be a bad thing? It is good business practice. All the things stated in the summary could be interpreted from another point of view.
Having a single customer, not looking for other contracts etc is good business practice as it reduces cost. No need to advertise, no travel costs and time off to secure new contracts etc.
There are any number of "legitimate" businesses that have preferred supplier status some of whome have exclusive contracts with their clients who are not regarded as part and parcel of their clients business.
For example: M&S have many suppliers who exclusively manufacture for M&S only. They only manufacture for M&S. They only manufacture what M&S want. They have to deliver to M&S targets.
Why then are those businesses not regarded as part and parcel of M&S?

I dont think its a bad thing at all, I didnt say it was? All businesses should have some element of repeat business with clients...However I still consider length of relationship to be a factor when Hector is deciding who to target, not the only one granted but a factor nonetheless

[dang65]

For example: M&S have many suppliers who exclusively manufacture for M&S only. They only manufacture for M&S. They only manufacture what M&S want. They have to deliver to M&S targets.
Why then are those businesses not regarded as part and parcel of M&S?

I was thinking this yesterday, but presumably it's not an issue because all the employees of those suppliers pay full employee taxes through their employers? i.e. They are the equivalent of "within IR35" already.

[kali]

I was thinking this yesterday, but presumably it's not an issue because all the employees of those suppliers pay full employee taxes through their employers? i.e. They are the equivalent of "within IR35" already.

I doubt their directors do though... using Hector's arguments surely they are just "disguised" senior managers for M&S?

[crack_ho]

I was thinking this yesterday, but presumably it's not an issue because all the employees of those suppliers pay full employee taxes through their employers? i.e. They are the equivalent of "within IR35" already.

But will the directors of the supply company be paying themselves massive salaries instead of dividends?

[The Lone Gunman]

I dont think its a bad thing at all, I didnt say it was? All businesses should have some element of repeat business with clients...However I still consider length of relationship to be a factor when Hector is deciding who to target, not the only one granted but a factor nonetheless

Hector will look at the whole deal. If there is an easy option he will use that. Like anybody else he will use the path of least resistance. A rudimentary defence will often be enough to disuade him from following one path.
Length of service can be properly defended quite easily. It can, and has been on a number of occasions, be easily ignored even for longer terms than this case. Look at the PCG wins. As Mal pointed out some of those wins had much longer terms than this one.

[The Lone Gunman]

I was thinking this yesterday, but presumably it's not an issue because all the employees of those suppliers pay full employee taxes through their employers? i.e. They are the equivalent of "within IR35" already.

It was just an example and I dont want to get into this argument but.......
I am an employee of my company and pay employee taxes through that company. You know all the arguments for keeping business costs down to increase profits. M&S suppliers can do this my Ltd can't.

[dang65]

I doubt their directors do though... using Hector's arguments surely they are just "disguised" senior managers for M&S?

Yeah, I see where you're coming from, but would one of us be in trouble if we were directors but got other people to go and do the work? I can't pretend to have a clue what I'm talking about here, but it seems to me that the target is the actual worker who is (in the view of this vague law) "pretending" to be an unconnected supplier, whilst effectively being an employee.

In the M&S supplier example, the company director would presumably be involved in running his company, employing staff, developing new lines etc, rather than going in to M&S's own kitchens every day to make delicious chocolate rice crispies cakes (£3.50 for six). Or something.