State of the Market

[rocktronAMP]

Notwithstanding the theory of Chapter 10, the risks may be greater now than with Chapter 8 ("old IR35"), simply because the Fee Payer and/or end client are likely to fold under pressure from HMRC (whereas HMRC would invariably lose under Chapter 8) and will then seek to blame and recover losses from elsewhere in the supply chain, hence the comment above about claw back clauses. That is why, personally, I will not accept any work under the Chapter 10 rules, but YMMV; if you do, note the point above about claw backs very carefully indeed.

Interesting, would this be an opportunity for another firm like QDOS, SJD and others to offer "clawback" insurance?

[eek]

Interesting, would this be an opportunity for another firm like QDOS, SJD and others to offer "clawback" insurance?

No because no insurance firm would be stupid enough to do it.

You are basically gambling £x,000 that a different firm isn't a grade A cretin who caves in at the first comment from HMRC.

And because the bills would be so big the insurance fees are such that no-one would do it.

Bluntly an IR35 contract with a clawback clause is a risk too far - safer to move on to a better paying Inside IR35 contract.

[rocktronAMP]

No because no insurance firm would be stupid enough to do it.

You are basically gambling £x,000 that a different firm isn't a grade A cretin who caves in at the first comment from HMRC.

And because the bills would be so big the insurance fees are such that no-one would do it.

Bluntly an IR35 contract with a clawback clause is a risk too far - safer to move on to a better paying Inside IR35 contract.

That's actually very helpful Eek.

In a nutshell, Outside of Off-Payroll Worker rules is only safe without any clawback clauses, if you can find an get them and/or your ultimate client fall within the 2 out of the 3 small business exemptions stipulations, assuming they are still going for the next financial year or two or so.

[hobnob]

I believe the Outside contracting market is now picking up after an otherwise flat-lined year.

I've had a similar experience. I finished my previous (inside) contract at the end of Jan, so last Monday I updated my profile on LinkedIn etc., saying that I was available for work but only for outside contracts. I knew that this would limit the opportunities, and I fully expected to be on the bench for a month. However, I had an interview on Friday and an offer yesterday, starting tomorrow.

I'm conscious of what happened to Keanu2020 last year, when an outside contract got switched to inside and he was stuck with the bill:
https://forums.contractoruk.com/acco...liability.html

In my case, I've received the SDS from the end client (public sector). However, my contract with Hays does have this clause:

4. If it is determined by the Client, that the Assignment falls within scope of IR35 any payment due to the Company pursuant to clause 4.1 shall be payable directly by the Employment Business or by the third party nominated by the Employment Business subject to the third party or Employment Business deducting all applicable taxes (including any national insurance contributions) required by law or any other fees charged by the third party or Employment Business. For the avoidance of doubt, if requested, the Company shall be required to enter into a separate contract with the third party in relation to payment, deduction of applicable taxes and other fees. The Employment Business shall not be liable for any losses whatsoever and howsoever arising from IR35.

I agree that it's a gamble, but fingers crossed!

[eek]

I've had a similar experience. I finished my previous (inside) contract at the end of Jan, so last Monday I updated my profile on LinkedIn etc., saying that I was available for work but only for outside contracts. I knew that this would limit the opportunities, and I fully expected to be on the bench for a month. However, I had an interview on Friday and an offer yesterday, starting tomorrow.

I'm conscious of what happened to Keanu2020 last year, when an outside contract got switched to inside and he was stuck with the bill:
https://forums.contractoruk.com/acco...liability.html

In my case, I've received the SDS from the end client (public sector). However, my contract with Hays does have this clause:



I agree that it's a gamble, but fingers crossed!

Given the bit in bold I don't think you've got a problem - HMRC have scared the public sector already so for the moment its safe to assume that a public sector outside IR35 really is outside provided you've seen the SDS determination.

[simes]

You are brave taking an outside contract given that HMRC are only now starting to focus on checking them. I hope you contract doesn't have a claw back clause and you've actually seen an SDS issued by the correct entity (which may be the ultimate end client).

Courage? Isn't an Outside contract what it's all about? I must admit during my couple of months on an Inside contract, I didn't even visit the Contractor forums. Didn't feel like a contractor. Maybe being 'in business' requires an element of being brave, if you will.

But yes, it's a SoW contract with no claw back clause. And to be sure, it all feels much better.

[simes]

No because no insurance firm would be stupid enough to do it.

You are basically gambling £x,000 that a different firm isn't a grade A cretin who caves in at the first comment from HMRC.

And because the bills would be so big the insurance fees are such that no-one would do it.

Bluntly an IR35 contract with a clawback clause is a risk too far - safer to move on to a better paying Inside IR35 contract.

Bearing in mind the past successes the individual contractor has had against the HMRC for IR35 claims in court, I feel in time once the clients get their heads around the law, and with the help of the likes of Qdos, and to ensure they have access to the whole contractor pool, more and more Outside roles will become available.

And I believe the likes of Qdos could very well indemnify companies against such claims. In time, to be sure. The next couple of years will likely demonstrate a transition period in the same way it did for contractors back in 2000 to 2002. I feel.

[eek]

Bearing in mind the past successes the individual contractor has had against the HMRC for IR35 claims in court, I feel in time once the clients get their heads around the law, and with the help of the likes of Qdos, and to ensure they have access to the whole contractor pool, more and more Outside roles will become available.

And I believe the likes of Qdos could very well indemnify companies against such claims. In time, to be sure. The next couple of years will likely demonstrate a transition period in the same way it did for contractors back in 2000 to 2002. I feel.

There are whole sets of companies that simply won't allow outside IR35 work because any risk on themselves is a risk too far.

Heck I'm noticing changes in the umbrella industry because the risk there (which is utterly minimal provided you do a tiny bit of due diligence) is too great for some firms.

[simes]

There are whole sets of companies that simply won't allow outside IR35 work because any risk on themselves is a risk too far.

I, and I think we, all realise that to be case at present. Not sure this really needs to be stated. Yes, this is very much the current case.

But as I, and at least one other here, has seen a rise in Outside roles then, as I said above, I believe there will be a transition period over the next couple of years where more will become available.

Indeed, reference what companies will and will not insure, the industry that appears to be offering the wider number of Outside roles are themselves Insurance companies. Infer from that what you will. This from friends and family who are contracting in said industry.

[eek]

I, and I think we, all realise that to be case at present. Not sure this really needs to be stated. Yes, this is very much the current case.

But as I, and at least one other here, has seen a rise in Outside roles then, as I said above, I believe there will be a transition period over the next couple of years where more will become available.

Do you agree to this last?

Nope, I actually expect this current peak to be a peak because once HMRC start investigating a few firms (and asking for the IR35 payments due) other firms are going to panic...

The pattern will follow the public sector which went:

Very few roles outside
More roles outside
HMRC come calling
Few roles outside where everyone is 100% sure it is outside.

Heck Digital Outcomes now feature a whole of lot inside IR35 roles and the entire point of Digital Outcomes was that it was outside IR35 work.