Guilty until proved innocent

[MrMarkyMark]

Having been around a while like some of the posters on here, I have seen these schemes come, go and blow.

Pretty much my whole family are self employed in some way or another, therefore, I always knew you didn't get something for nothing.

Conversations were always had, with other contractors, about how much more you can get, approved scheme, no problem, why don't you etc. etc.
They always knew exactly what they were doing.

Couldn't see how it could possibly be worth it, given you were only talking about creaming an extra 10-12% (over LTD).

[centurian]

I wonder if any of these people take this to the European court of human rights. After all I thought the right to a fair trial was a basic one.

I am sure it will go all the way to the ECHR.

HMRC's basic defence is that APNs are the same as PAYE - you pay the money up front and if you disagree with the amounts taken, you take HMRC to court to get the money back. The concept of pay now, argue later has been enshrined in the tax code for decades.

[DaveB]

I am sure it will go all the way to the ECHR.

HMRC's basic defence is that APNs are the same as PAYE - you pay the money up front and if you disagree with the amounts taken, you take HMRC to court to get the money back. The concept of pay now, argue later has been enshrined in the tax code for decades.

APN's are not the same.

Under PAYE you make an advance payment on next years tax, based on the current year. When you submit your SA for the next year the tax payed is set against the tax owed and if it turns out you paid too much in the advance payment you get it back pretty much immediately. They will also pay interest on any extra that you paid. No arguing involved.

With APN's HMRC can decide you owe them money, for whatever reason, and it doesn't have to be linked to your current PAYE status, and demand that you pay all of it within 90 days or suffer penalties. The onus is then on you to prove that you didn't owe it. HMRC will then decide whether your proof is acceptable before they give you the money back, or not. They pay no interest on the money held if they do decide to give it back and if you can't pay the APN for whatever reason, you end up having to pay a 15% penalty regardless of the final outcome.

If they decide to take a blanket approach and challenge every contractors IR35 payments by deciding we were all actually inside unless we can prove other wise you could end up with a tax bill for all the "unpaid" tax and NI for your contracting years, with 90 days to pay or suffer the consequences.

[DimPrawn]

Lots of people are missing the point here.

The point is HMR&C are using powers introduced by our Tory friends who love and cherish us, to demand money with menaces for tax they believe you owe, going back many years. They don't have to present why, or how they calculate it, they just say pay £50K or whetever by Wednesday or we send the boys round.

It's up to YOU then, to pay £500/hr laywers and tax advisors and PROVE you don't owe the money.

Whether it's some obviously dodgy "scheme" or our old friend, "disguised employment" matters not.

[psychocandy]

Signed up for dodgy scheme, thinking, hmm I can get away with this. Probably paid something like 2-3% tax and live the life of riley for years.

Now bleating that hes got caught with his cock in till. Amount of sympathy = ZERO from me.

Got a bit of thing about this having seen it first hand. Dear brother spent years acting like a millionaire, paid zero tax, chucked letters in the bin. Then bleats because its so unfair that hes got to pay it back now and how can he clothe and feed his kids. Boo hoo.

[suityou01]

Lots of people are missing the point here.

The point is HMR&C are using powers introduced by our Tory friends who love and cherish us, to demand money with menaces for tax they believe you owe, going back many years. They don't have to present why, or how they calculate it, they just say pay £50K or whetever by Wednesday or we send the boys round.

It's up to YOU then, to pay £500/hr laywers and tax advisors and PROVE you don't owe the money.

Whether it's some obviously dodgy "scheme" or our old friend, "disguised employment" matters not.

So the IR35 insurance racket just collapsed overnight?

[VectraMan]

If they decide to take a blanket approach and challenge every contractors IR35 payments by deciding we were all actually inside unless we can prove other wise you could end up with a tax bill for all the "unpaid" tax and NI for your contracting years, with 90 days to pay or suffer the consequences.

I hope everybody's been putting the "extra" money aside.

If you did the right thing (which I never did) of having a review or whatever before deciding to be outside IR35 then proving otherwise should be a formality. In theory. At least IR35 comes down to a matter of opinion; the loan that's never repaid scam is so clearly a scam there's really no debate. Maybe instead of paying the tax they'd like to repay their loans. That'd shut them up.

[suityou01]

I hope everybody's been putting the "extra" money aside.

If you did the right thing (which I never did) of having a review or whatever before deciding to be outside IR35 then proving otherwise should be a formality. In theory. At least IR35 comes down to a matter of opinion; the loan that's never repaid scam is so clearly a scam there's really no debate. Maybe instead of paying the tax they'd like to repay their loans. That'd shut them up.

I think the point is, you have to pay the money first, then claim it back through the courts. So if in HMRC's opinion you owe them 50K, then you have 3 months to pay.

[tomtomagain]

Maybe instead of paying the tax they'd like to repay their loans. That'd shut them up.

I wonder if the people who run these offshore loan schemes ever think about calling in the loans?

[VectraMan]

I think the point is, you have to pay the money first, then claim it back through the courts. So if in HMRC's opinion you owe them 50K, then you have 3 months to pay.

Which will spawn a whole new sub-industry of IR35 related claims against HMRC. Once again it's only the lawyers that win.