IR35 - who are the actual targets?

[Clare@InTouch]

Where does it end then? Is my window cleaner an employee of my ltd company, for the 15 minutes he spends partially wiping a damp cloth over the more accessible bits of my windows?!

Do you tell your window cleaner how to do his job? When to do it? No? Then there' no control.

Can he send his mate to do the job without checking with you first? Yes? Then there's no personal service.

Can he stop doing your windows when he wants? Do you guarantee that you'll always have a job for him? No? Then there's no MOO.

Cover any of the three above and IR35 cannot apply. Simples

[meanttobeworking]

Can he stop doing your windows when he wants? Do you guarantee that you'll always have a job for him? No? Then there's no MOO.

So as long as there is no notice period in either direction in a contract, and no mention of ongoing work after the "estimated duration" of the contract, happy days

[Clare@InTouch]

So as long as there is no notice period in either direction in a contract, and no mention of ongoing work after the "estimated duration" of the contract, happy days

MOO is the most difficult one to prove usually, and even HMRC don't seem to understand it sometimes, but it has recently been a major factor in an IR35 success case.

Freelancer Wins Seven Year Battle With HMRC In Significant IR35 Ruling | PCG

[Lewis]

Do you tell your window cleaner how to do his job? When to do it? No? Then there' no control.

Can he send his mate to do the job without checking with you first? Yes? Then there's no personal service.

Can he stop doing your windows when he wants? Do you guarantee that you'll always have a job for him? No? Then there's no MOO.

Cover any of the three above and IR35 cannot apply. Simples

I follow your point, you are highlighting the legislation, but I still find the legislation daft.

e.g. if I get the same window cleaner as you hypothetically used to clean the inside of my windows in my house and I say, because I'm a bit of a control freak, “I’m going out in 1 hr and I need you to be done before I leave, I want you to start with the upstairs windows and if you have time to do the downstairs ones. Please use warm, soapy water and wipe the window sills afterwards, I don’t want any marks on the carpet - I want you to put this dust sheet down before you start each window. I want only you doing this, don’t bring a stranger into my house without my checking them out first. I’ll pay you £50. If you finish early then keep the change. I want you to come every month for the next year and I’ll give you at least a months notice when I want you to stop coming”. So is this window cleaner now my employee?

Another example, we have a contact with a cleaning company to clean our house, they can send any cleaner (subject to our approval) but we have had the same one for years, we explain what room she should do and how to do it (e.g. dust up here, clean behind here etc.), do the cooker this week but not another. We have a contract and a notice period with the cleaning company. So is this cleaner our employee? She is certainly a paid employee of the cleaning company, are they just her ‘disguised’ employer?

It makes no sense to me. The 'rules' don't define a business in my opinion.

[malvolio]

It makes no sense to me. The 'rules' don't define a business in my opinion.

Some of us have been beating that particular gong for around 11 years now. Ten of them were under Gay Gorgon and the New Labourite loonies, so no chance of any changes (hey, they didn't manage to produce one single coherent piece of legislation in 13 years...). Now we have a new government (of sorts), things may change. Slightly. Perhaps...

To be precise the rules do define a business, but the case law has evolved using the employment tests of D&C. MOO and RoS as the key markers. The problem is that the markers do not have discrete boundaries.

[thunderlizard]

It started out by targeting the people who left work on a Friday as an employee and started work on a Monday as a contractor.

It was certainly supposed to, and if you write to your MP, the chances are he'll tell you that's what it does. The problem is that the law is written with absolutely no reference to that at all!

[TykeMerc]

I follow your point, you are highlighting the legislation, but I still find the legislation daft.

There's a good reason for that as to most rational people it IS pretty daft to a real contractor.

The only way it makes sense is if you think of the Friday to Monday Perm to Contractor situation. Not a small number of people found it attractive as a way to do the same job/same place/same work for much more money and their employers loved it as it reduced their head count/pensions/holiday liabilities. Everybody won in that situation apart from the tax man who lost out quite a bit.
Literally speaking IR35 was introduced to counter that, but it rapidly became used as a scare tactic to push contractors into Umbrella type employment and HMRC have tried to apply it to all sorts of genuine contractors where the original intent simply isn't applicable.

[northernladuk]

There's a good reason for that as to most rational people it IS pretty daft to a real contractor.

The only way it makes sense is if you think of the Friday to Monday Perm to Contractor situation.

Unfortunately the Fri to Mon contractor out numbers the real contractors by many 10's to 1 so the real guys get caught up in the catch all approach

[TykeMerc]

Unfortunately the Fri to Mon contractor out numbers the real contractors by many 10's to 1 so the real guys get caught up in the catch all approach

Not in my experience, not these days.

In the mid to late '90's it was a pretty common sight to me, but for the last 5+ years every contractor I've come across has been moving around different clients on a true contractor basis. Most of them had never worked at the clients as permies or if they had it was months to years before they became contractors.
Actually that's incorrect, I worked with 1 bloke in 2003/4 who had been on the same site and same desk for close to 10 years doing the same function. If the client could have convinced him to go perm or replaced him with a permie then they would have. He was actively being IR35 investigated too. That's 1 out of at least 50 contractors.

[Lewis]

Unfortunately the Fri to Mon contractor out numbers the real contractors by many 10's to 1 so the real guys get caught up in the catch all approach

I think even the Fri-Mon bit is a load of rubbish. Every business has to start somewhere. Why is a business not a business until it has been running for a while and only deals with 'new' clients. I think that if you are operating through a Ltd company, are a PAYE employee/er etc..etc.. then that should be how you are treated. I've never agreed with the Mon-Fri, MOO, DAC etc.. arguments. But of course, I like everyone else know the reasoning is purely driven by tax revenue rather than logic or common sense .... and like Mal says we've all been banging on about it for a decade. Ho hum.