Legality of tax insurance

[Wanderer]

The TLC35 insurance was constructed by ex-HMRC inspectors and was reviewed and approved by insurers prior to being released to the market a number of years ago.

Can you give us a real world example of a case (anonymised of course) of where you have paid out? Or has this never happened?

[MikeToml]

Very helpful discussion

Cheers guys, especially Lisa and Qdos.

I think my mate may not have realised this wasn't a criminal matter, or taken account of the conditions Qdos Consulting mentioned. As I said, he is pretty knowledgeable about insurance generally but this area is not one he has experience of.

I still don't look forward to that inevitable envelope landing on my doorstep but I am somewhat reassured.

Am sure it's been said many times many ways but what I despise most about IR35 is the greyness of it and the atmosphere of fear, uncertainty and doubt that goes with it.

[centurian]

Can you give us a real world example of a case (anonymised of course) of where you have paid out? Or has this never happened?

Only QDOS can answer this one, but I doubt they have ever had to pay out. Only a handful of cases have gone all-the-way, and they were probably not TLC35 policy holders.

Thats why the insurance is relatively cheap. The chances of a claim are low - and they don't offer cover to the really high risk ones. If they lose a case, I would fully expect them to cough up.


Of course if they start losing a succession of cases - and end up having multiple 6-figure payouts, expect their underwriters to demand significantly higher renewal premiums, or pull the plug completely on the product - which leaves people exposed for 5 years as the cover is only for investigations initiated in the 1 year you have the policy, not the following 5 years.

[Qdos Contractor]

Out of the 1,300+ cases we've dealt with we've only lost about 5 and none of them had the full TLC35 insurance. This has only been down to the skill and experience of our consultants; the cases we have won certainly haven't been easy (as numerous clients will testify).

When we designed the product we certainly didn't expect to maintain a claim-free record on the liability part of the insurance and, assuming HMRC plough resources back into IR35 once the review is complete, I doubt the record will stay intact. This is something both Qdos and our underwriters appreciate.

For the avoidance of doubt, we have never rejected a TLC claim or pulled out of covering a case. We actually like dealing with IR35 enquiries.

[psychocandy]

Some good insight from QDOS here on their policy. I havent taken it out yet but I think I will do soon,

[Alan @ BroomeAffinity]

I should say, as I kind of panned the TLC product, in the interest of balance, the TaxWise product is exceptional. So far I have only had to make a couple of small claims and all were paid without any problem and the panel of experts you can call on really are very good.

[BillHicksRIP]

We actually like dealing with IR35 enquiries.

Love it!