Newbie: OPT in / OPT out IR35 impact?

[Hello]

Hi, Am a newbie taking the plunge from Permie ( in investement back A ) to Contract ( in investment bank B). Will be forming a Ltd Company. Did my reading and search and looks like not OPTing out is in the best interest of the contractor. When I mentioned this to my agency as well as the accountant ( doing the IR35 review of my contract) they mentioned that I need to OPT OUT as opting in implicates on the IR35 status which the account said is otherwise passed. Need some advise from the experienced people here if this true and signing an OPT OUT is the only option?

Many Thanks for your help and guidance.

[DirtyDog]

They need to do some more research. Opting out of the agency regulations has no impact on IR35.

There is a paper on it on the PCG website, but I think that you need to be a member to read it.

Not opting out means that there is more work for the agent to do, with the right to return quicker without an agent and a guarantee that you get paid even if they don't - so it's in their interest to get you to opt out.

[northernladuk]

Bit more research needed..... It is argued quite clearly in quite a few articles on this site and others similar. Google will be your friend here.

[Project Monkey]

Bit more research needed..... It is argued quite clearly in quite a few articles on this site and others similar. Google will be your friend here.

Oh well, there goes another potential future contributor to this forum.

[kevpuk]

A little surprised that OPs accountant reckoned it was IR35 relevant, the Opt In/Out part...?
Also....

ADVICE not advise

[northernladuk]

Oh well, there goes another potential future contributor to this forum.

Not sure why you think that. A simple search for the term 'Opt out IR35' brings back a host of articles which explain the situation to the OP much better than we can argue it on here. Written by professionals and not random musings of a load of contractors.

You could of course actually add a bit of advice yourself. I can't remember a single one of your posts that add any value whatsoever. Picking on a couple of my posts and ignoring the ones that are very helpful makes you look a bit of a prick really.

[northernladuk]

A little surprised that OPs accountant reckoned it was IR35 relevant, the Opt In/Out part...?
Also....

ADVICE not advise

Why are you surprised? Many of the Opt out/in articles do mention IR35 and it is worth thinking about. Remember these are employment regulations so that title alone should have you looking at it very carefully when we spend so much time and effort trying to avoid looking like an employee. I know the rules but it still doesn't sound right that we opt in to employment regs.

Even the professionals can't agree if it actually helps/hinders or is IR35 neutral.

[DirtyDog]

Why are you surprised? Many of the Opt out/in articles do mention IR35 and it is worth thinking about. Remember these are employment regulations so that title alone should have you looking at it very carefully when we spend so much time and effort trying to avoid looking like an employee. I know the rules but it still doesn't sound right that we opt in to employment regs.

No they aren't. The full title is "The Conduct of Employment Agencies and Employment Businesses Regulations 2003" - they are not employment regulations, nor do they say that (unless you ignore the word "Business" from the title).

[northernladuk]

No they aren't. The full title is "The Conduct of Employment Agencies and Employment Businesses Regulations 2003" - they are not employment regulations, nor do they say that (unless you ignore the word "Business" from the title).

Yup, good point but still enough to make anyone consider the IR35 implications and research it.

[malvolio]

One of the iniquities of IR35 (and there are many) is that it uses employment laws to establish the tax position of someone who is not an employee. It's not all that surprising that an accountant who is not well versed in modern freelancing will make basic - and erroneous - assumptions. Another reason to choose the right people perhaps.

The PCG guide is members only - why wouldn't it be? - but that is easily rectified at very little cost* and a whole shedload of additional resources and protections then become accessible. Its overall conclusion is that it is marginally better to opt out but is of no great consequence either way. It is certainly nothing to do with IR35.



* @OP - www.pcg.org.uk: this is a very broad hint...