New PCG IR35 Questionnaire

[swamp]

As has always been obvious to many they can only do this by opening lots of new investigations which will be run by new specialist HMRC IR35 teams. The business tests were not HMRC's idea and are a small part of the whole process. My view has always been that as the IR35 legislation has not changed this has never been an opportunity to change IR35 and it would be naive to think otherwise. Others disagree.

Kate

Well I'm glad the PCG were in on this... Thirteen years of protesting against IR35 and they finally achieve something: making it worse.

[Kate Cottrell]

As someone who makes their living fighting IR35 cases, is there something not quite right about asking you what should change with the system?

Do you not have a vested interested in keeping IR35 as confusing as possible, so that those that are investigated end up paying for your services?

Just asking like.

The handful of IR35 cases over the last few years do not amount to any sort of a living especially when we work on a fixed fee basis!

I was asked to join the OTS and IR35 Forum because of my expertise in this area. Do you really think that I have any power to keep IR35 or that anyone else has any power to do away with it over the power of the Government? I wish!

The vested interest argument applies to everyone invited onto the Forum and all the other stakeholders consulted.

[Sockpuppet]

The handful of IR35 cases over the last few years do not amount to any sort of a living especially when we work on a fixed fee basis!

I was asked to join the OTS and IR35 Forum because of my expertise in this area. Do you really think that I have any power to keep IR35 or that anyone else has any power to do away with it over the power of the Government? I wish!

The vested interest argument applies to everyone invited onto the Forum and all the other stakeholders consulted.

Agreed with Kate on this one. If anything the PCG have the most to lose by IR35 going by the way side. If they didn't offer insurance against investigation I wouldn't be a member and I think 90% of others would feel the same.

Whether that is right or wrong is another question - but personally I'd find it hard to fork out £220 for just a massive contractor love in. I know they do more than just IR35 but for me, personally I wouldn't see it as a justified cost.

[Boo]

IR35 was an attempt to kill contracting stone dead and give the likes of Anderson Consulting a leg-up.

IR35 was a (successful) attempt to prevent the large financial sector employers of IT people from slashing their NI and Tax bills by employing the same people as permies during Monday to Thursday and as contractors from Friday to Monday. Ie, the banks were paying large salaries and overtime on big hours and decided to cut their costs at the expense of the IR. Hence the name "Friday-to-Monday Contractors" and hence IR35.

The reason for big companies preferring big consultancies to independants has more to do with (the contents of) brown paper bags than anything else

Boo

[malvolio]

Agreed with Kate on this one. If anything the PCG have the most to lose by IR35 going by the way side. If they didn't offer insurance against investigation I wouldn't be a member and I think 90% of others would feel the same.

Whether that is right or wrong is another question - but personally I'd find it hard to fork out £220 for just a massive contractor love in. I know they do more than just IR35 but for me, personally I wouldn't see it as a justified cost.

Perhaps you should take a look at the things they are doing in a bit more detail then; they are about a hell of a lot more than IR35. Or would you rather there was no representation of contractors in the various policy committees and we had no voice in the consultation on any and all relevant legislation? Had PCG existed in 1999 in its present form, IR35 would never have happened.

And I've never understood the mentatlity that says £220 is a lot to pay to protect a £100k a year income stream...

[Bunk]

IR35 was a (successful) attempt to prevent the large financial sector employers of IT people from slashing their NI and Tax bills by employing the same people as permies during Monday to Thursday and as contractors from Friday to Monday. Ie, the banks were paying large salaries and overtime on big hours and decided to cut their costs at the expense of the IR. Hence the name "Friday-to-Monday Contractors" and hence IR35.

The reason for big companies preferring big consultancies to independants has more to do with (the contents of) brown paper bags than anything else

Boo

I thought Friday to Monday referred to employees quitting their job on Friday and coming back on Monday as a contractor doing the same job? Could be wrong though.

[Grasser73]

I thought Friday to Monday referred to employees quitting their job on Friday and coming back on Monday as a contractor doing the same job? Could be wrong though.

No, you are right. Where Boo got that nonsense from is anyone's guess.

[bobspud]

Sorry Bobspud. I am happy to reply publicly but do wonder what you have been told privately. Maybe Mal will tell us.

My personal view is that the calls for the abolition of IR35 or later calls for the use of business entity tests (previously rejected by the OTS and the Government) has resulted in little help for the average Freelance Contractor. Indeed with the previously extremely low levels of IR35 investigations some would consider the situation now to be far worse. The fact remains that the IR35 legislation has not changed so there is still a need to consider your IR35 status on a contract by contract basis. What has changed is that for those taking the business tests and scoring (and proving) to be low risk means that HMRC will close the review as soon as possible. Guidance and HMRC assistance will be improved and we should see an end to investigations going on for many years.

HMRC were tasked with improving the administration of IR35 and measuring the results of this new approach. As has always been obvious to many they can only do this by opening lots of new investigations which will be run by new specialist HMRC IR35 teams. The business tests were not HMRC's idea and are a small part of the whole process. My view has always been that as the IR35 legislation has not changed this has never been an opportunity to change IR35 and it would be naive to think otherwise. Others disagree.

Kate

Thanks for the clarification

[malvolio]

completely agree. I was trying to raise the similar points for years here but was always rebuffed by Malvolio pointing effectively that if you are not a 'genuine' business than you have to pay IR35. Although I believe that there are bunch of people who are not that kind of business but still are entitled to get adequate tax relief (adequate to the effort and risk).

Don't think I ever said that, but happy to be proved wrong.

What I have said is that you and I earn our crust through our companies and find new clients, and take on all the risks that implies. People whose only client is their previous employer, and people who run companies to absorb earnings they get separate to their permanent day job, are not taking those same risks and perhaps shouldn't be looking to gather the same tax advantage (which isn't one, given how much we do actually pay end-to-end) as we do. If that means IR35 is the mechanism, then fine.

[Sockpuppet]

Perhaps you should take a look at the things they are doing in a bit more detail then; they are about a hell of a lot more than IR35. Or would you rather there was no representation of contractors in the various policy committees and we had no voice in the consultation on any and all relevant legislation? Had PCG existed in 1999 in its present form, IR35 would never have happened.

And I've never understood the mentatlity that says £220 is a lot to pay to protect a £100k a year income stream...

Perhaps I should then again I was happy with the IR35 investigations were at 4 per year. Let sleeping dogs lie and all that.

Although its a big claim to say that IR35 would never have existed, you can't claim that neither can you claim that the alternative would have been any better.