Quick IR35 2.0 question

[Jog On]

I understand that they're about to release this self assessment risk profile thing however..

...apart from that have the conditions and rules that deem you inside or outside (ROS/MOO/D&C etc) changed?

Lets say you find out you're at higher risk of investigation than you thought but your contract and actual terms of business are still outside does it just mean you're just more likely to get investigated if you pay yourself outside?

Are there any other changes to the actual conditions that deem you inside/outside or is it just a ramping up of enforcement/deterrant?

[Clare@InTouch]

As far as I understand it the legislation hasn't changed, so we're still looking at exactly the same things we were previously. All that's changing is HMRC guidance to help make it clearer to all of us.

[jamesbrown]

As I understand it, there will be additional guidance, and probably an enforcement drive, but no changes of substance because the legislation hasn't changed. The key factors remain a contract with one or more of ROS/MOO/D&C, which is then reflected by working practices.

[russell]

I don't worry about IR35 at all, if they say I am a disguised employee and want to tax me as one then I will want holiday/sick pay etc for the same period. That's the simple argument that destroys the stupid rule.

[JamJarST]

I don't worry about IR35 at all, if they say I am a disguised employee and want to tax me as one then I will want holiday/sick pay etc for the same period. That's the simple argument that destroys the stupid rule.

How will that help you if HMRC deem your contract is inside IR35?

[Clare@InTouch]

I don't worry about IR35 at all, if they say I am a disguised employee and want to tax me as one then I will want holiday/sick pay etc for the same period. That's the simple argument that destroys the stupid rule.

Not being a lawyer I'm not sure how up to date this is, but.....

''You'd be out of luck,'' says Theresa Mimnagh, a lawyer (senior consultant) with the Hove-based legal consultancy Lawspeed which specialises in recruitment and contractor affairs. "You can only go to the Employment Appeals Tribunal within three months of the end of your contract to demand employee rights but HMRC can wait six years to claim that you are actually within IR35."

"Bear in mind that a case with the Employment Appeals Tribunal may take two to three years to decide. And while you don't actually need a lawyer to go before the Tribunal, you probably don't have much chance without one in this complicated area of legislation. So you have to decide right after your contract is up if you intend to make this effort or not."

<removed>

And the case to which it refers:

<removed>

[JamJarST]

Not being a lawyer I'm not sure how up to date this is, but.....

''You'd be out of luck,'' says Theresa Mimnagh, a lawyer (senior consultant) with the Hove-based legal consultancy Lawspeed which specialises in recruitment and contractor affairs. "You can only go to the Employment Appeals Tribunal within three months of the end of your contract to demand employee rights but HMRC can wait six years to claim that you are actually within IR35."

"Bear in mind that a case with the Employment Appeals Tribunal may take two to three years to decide. And while you don't actually need a lawyer to go before the Tribunal, you probably don't have much chance without one in this complicated area of legislation. So you have to decide right after your contract is up if you intend to make this effort or not."

<removed>

And the case to which it refers:

<removed>

Even if you could claim employees rights by going to the tribunal, you would still have to pay the tax and penalties to HMRC and you would only get sick pay if you could show when you took time off for being sick and they would only be obliged to pay SSP.

[Jog On]

So I'll just make sure contract has correct clauses + ensure there isn't too much (if any) D&C + PCG insurance and keep invoicing.

Another thing I don't get which is in a similar vein to the holiday/sick pay thing. If as a temporary contractor none of us have any MOO - is this simply not enough to sink any investigation regardless of other points? Or is it murkier than that.

Also having a clause obliging you to fix any errors in your own time and at your own expense (financial risk) is this also not enough on it's own?

How about financial risk + lack of MOO - how many permies would agree to those clauses going into their contracts of 'employment'?

[amcdonald]

I don't worry about IR35 at all, if they say I am a disguised employee and want to tax me as one then I will want holiday/sick pay etc for the same period. That's the simple argument that destroys the stupid rule.

But you'll only be a deemed employee for tax purposes, you'll have an uphill battle to get any employment rights

[ready_to_leave]

But you'll only be a deemed employee for tax purposes, you'll have an uphill battle to get any employment rights

Indeed that is correct. During an IR35 discussion quite a few years ago HMRC told me that it is perfectly reasonable for a person (me in that case) to occupy 2 seemingly mutually exclusive tax positions simultaneously, depending on which particular part of the tax code they were actively pursuing at the time.

Considering that if you are deemed A then you cannot be B is something you consider logical but does not factor in their thinking or assessment. And you will only get frustrated if you think in this way.