IR35 post April 2011

[VectraMan]

I'd be appaled if "the office of tax simplification" came up with yet another income tax band on top of what we've already got. Because that's effectively what you're proposing!

WHS.

They were talking of having a much simpler test; a set of yes/no questions that'd make it clear and obvious who was meant to be caught and who was not. It's always seemed to me we're a pretty simple group to define and all this arsing about with MOOs and contract checks is in nobody's interests (except maybe the accountants).

[BolshieBastard]

Alan Jones sold out contractors who he 'convinced' to join his scheme to HMRC. He's pulling a similar trick with BN66.

Why does anyone tolerate this *unt?

[cojak]

Alan Jones sold out contractors who he 'convinced' to join his scheme to HMRC. He's pulling a similar trick with BN66.

Why does anyone tolerate this *unt?

I wouldn't dream of joining one of Mr Jones' schemes, and I wouldn't join an umbrella unless they made me. And there'll be a lot of umbrellas out there to choose from...

[BolshieBastard]

I wouldn't dream of joining one of Mr Jones' schemes, and I wouldn't join an umbrella unless they made me. And there'll be a lot of umbrellas out there to choose from...

This 'guy' is no friend to contractors no matter how 'pally, pally' he may try and make himself.

AFAIA he doesnt run schemes now. Mind he'd be lucky to get anyone but the gullible or naive to join him seeing as he sold all his 'clients' out to HMRC last time.

[d000hg]

Alan Jones sold out contractors who he 'convinced' to join his scheme to HMRC. He's pulling a similar trick with BN66.

Why does anyone tolerate this *unt?

You mean the poster above, or is that a joke name... I never heard of AJ?

[cojak]

You mean the poster above, or is that a joke name... I never heard of AJ?

It's all in the BN66 sticky over in Accounting/Legal.

It's a long and messy tale. Mr Jones is not the most popular poster over there and has troll-like tendencies.

[Moscow Mule]

If dividends were to be taxed the same as PAYE, why would you continue to pay yourself a small salary?

Surely you would leave as little profit in the company as possible?

[Fred Bloggs]

If dividends were to be taxed the same as PAYE, why would you continue to pay yourself a small salary?

Surely you would leave as little profit in the company as possible?

Exactly. But there'd no longer be any point in doing what I'm doing, working at the other end of the country and living off the equivalent of a decent permie take home whilst saving as much as I can into my SIPP. I'd be almost as well off on a good permie package where the employer makes a decent contribution to my pension and I get home every night and act dliatory at work like all the other staff blokes.

[VectraMan]

Exactly. But there'd no longer be any point in doing what I'm doing, working at the other end of the country and living off the equivalent of a decent permie take home whilst saving as much as I can into my SIPP. I'd be almost as well off on a good permie package where the employer makes a decent contribution to my pension and I get home every night and act dliatory at work like all the other staff blokes.

So the one and only reason you're a contractor is that it reduces the percentage of tax you pay?

I did my first contract through an umbrella, and I still doubled my income over my previous permie job. Paying the full amount of tax doesn't mean there's no point in contracting.

It would still be worth having a Ltd. as you can then plan your income over several years; in other words acting as a proper business. For a couple of years I paid myself exactly the right amount to not go into the 40% bracket, something I couldn't have done with an umbrella or inside IR35, but I could still do if dividends were taxed as income.

If dividends were taxed as income, then it could also follow that they could lift the requirements on small Ltds to do annual corporation tax returns and accounts, and that would be a benefit. We wouldn't really need accountants if it was just a case of doing a personal tax return once a year.

[Fred Bloggs]

So the one and only reason you're a contractor is that it reduces the percentage of tax you pay?

I did my first contract through an umbrella, and I still doubled my income over my previous permie job. Paying the full amount of tax doesn't mean there's no point in contracting.

It would still be worth having a Ltd. as you can then plan your income over several years; in other words acting as a proper business. For a couple of years I paid myself exactly the right amount to not go into the 40% bracket, something I couldn't have done with an umbrella or inside IR35, but I could still do if dividends were taxed as income.

If dividends were taxed as income, then it could also follow that they could lift the requirements on small Ltds to do annual corporation tax returns and accounts, and that would be a benefit. We wouldn't really need accountants if it was just a case of doing a personal tax return once a year.

Not quite the case and indeed I do plan things in the way you describe. At the end of the day, I'll see what happens and decide. Current gig is very lucrative but I'm working away. Last two gigs were home based (on about 40 to 45% of current rate) but I took home no more (all things considered) than a top flight staff guy. If things get tougher then doing a home based gig (which is my preference) would then be pointless.