Dividends

[Jog On]

Aside form IR35 I'm what they could come up with and how they would implement it?

[VectraMan]

You are correct, but neither are we employees with paid holidays, sick leave and other perks (health cover, etc).

At the moment the problem seems to be you pay NI twice or not at all, simply making all personal income treated as salary and removing the company-NI aspect would be one obvious option although it still doesn't make up for the fact we don't get benefits & rights afforded to employees. That being said, shift/temporary workers often pay NI/PAYE and have no rights anyway so maybe that's not a good angle to take when earning 10X as much as they do.

Cobblers. It's getting paid almost double that makes up for the lack of employee rights for contractors; you're not doing it for the NI saving.

And as has been said, permies pay employer's NI too, they just don't necessarily know it because salaries are quoted after ERNI. So maybe the industry changes and contract rates are also quoted after ERNI and the client pays it for you, then you're not paying NI twice and presumably you'll be happy.

[DirtyDog]

Well it was coming anyway. No way most of you lot with your single, sequential clients, some of which you work for years, are businesses.
Although no doubt there'll be lost of whinging rather than changing your business model to become real cos.

If they are going to tax all dividends as income, then that impacts "real" companies as well where you take a dividend.

[sasguru]

Also Sas you may still find yourself caught since you are still a 1-man band and could be tarred with the same brush if big sweeping strokes are made. You're a PSC, I'm a PSC - in both cases the business IS effectively the person involved - your clients engage yourCo because they want your personal expertise.

Nope. My clients engage me for a job of work, I can get whoever I want to do it (its in the contract).
I have had multiple clients at one time.
If I finish any job early I can earn more money for another job. I have my own office (albeit at home).
Look at the list of questions Hector asks to see if you're IR35 compliant.
Now IR35 is a little vague, but I'm as sure to be out of it as you can be.

[sasguru]

If they are going to tax all dividends as income, then that impacts "real" companies as well where you take a dividend.

That's a different story.

[MicrosoftBob]

If they are going to tax all dividends as income, then that impacts "real" companies as well where you take a dividend.

They'll just tax what they deem to be personal service companies, anything else would be political suicide

[eek]

Nope. My clients engage me for a job of work, I can get whoever I want to do it (its in the contract).
I have had multiple clients at one time.
If I finish any job early I can earn more money for another job. I have my own office (albeit at home).
Look at the list of questions Hector asks to see if you're IR35 compliant.
Now IR35 is a little vague, but I'm as sure to be out of it as you can be.

And given the easy to implement sledgehammer approach that HMRC will use to implement this plan how do you think any of the above will let you escape.

You can escape IR35 (to be honest that isn't that difficult) but escaping this is probably going to be a lot lot harder....

[sasguru]

I agreed with you. See above. I don't know what these changes are going to be.

[Pondlife]

Nope. My clients engage me for a job of work, I can get whoever I want to do it (its in the contract).
I have had multiple clients at one time.
If I finish any job early I can earn more money for another job. I have my own office (albeit at home).
Look at the list of questions Hector asks to see if you're IR35 compliant.
Now IR35 is a little vague, but I'm as sure to be out of it as you can be.

I can get whoever I want to do it (its in the contract). - having it in the contract, 2 points, actually exercising it, 20 points.

I have had multiple clients at one time. - IR35 is on a contract by contract basis. from HMRC
Some businesses have not only engagements outside IR35 but also engagements within IR35.

If I finish any job early I can earn more money for another job. - Good pointer, 10 points

I have my own office (albeit at home). - Irrelevant
Does your business own or rent business premises which are separate both from your home and from the end client’s premises?


The fixed price work is the best indicator you have IMHO.

[MyAccountant]

I think this will cause more hurt than good to be honest, especially if this aims to unfairly penalise small businesses like so many of the revenues tax avoidance schemes. OK the revenue might get a little extra in the short run but the trade off between businesses continuing to trade and the tax revenue in the long run i think will be quite harmful to the UK economy.