IR35 unfriendly wording

[TestMangler]

I've always been slightly sceptical over IR35 insurance. So many of the criteria that are used to assess whether or not you are eligible for cover are what I call grey areas.

I mean, look at the question of substitution. QDOS state that you can be covered if you are not aware of any reason why you would not be permitted to deploy a substitute.

Ok, if you're at this stage it's a safe assumption that the contract SAYS you can do it but can you do it in reality?

I am sure this could be used as a sticking point in event of a claim.

You know nothing about it, having never used and so are sceptical. That's sensible.

Then you become sure of something you admit to being sceptical about ??

Schizo-chick !!

[Old Greg]

QDOS clarified this in a post awhile back but I can't find it. As long as there is a possibility or expectation (can't remember the wording they used) that there is RoS it doesn't have to be exercised. A Letter of Confirmation from the client should back up your RoS which would be useful either way.

But the client will probably tell you to bugger off and the RoS will be shown to be a sham. It is of course probably a sham anyway but by clarifying you lose the safety of the grey areas in which many of us operate.

[Craig at Nixon Williams]

I've always been slightly sceptical over IR35 insurance. So many of the criteria that are used to assess whether or not you are eligible for cover are what I call grey areas.

I mean, look at the question of substitution. QDOS state that you can be covered if you are not aware of any reason why you would not be permitted to deploy a substitute.

Ok, if you're at this stage it's a safe assumption that the contract SAYS you can do it but can you do it in reality?

I am sure this could be used as a sticking point in event of a claim.

When you get a contract reviewed, the reviewer is simply passing their opinion as to whether it passes or fails for IR35, likewise if HMRC looked at it their argument would be based on their opinion. If Qdos (or the likes of) are happy to back up their opinion with an insurance policy then that should give you more confidence in what they have said!

On the RoS stuff, I find it unlikely that an insurance payout could be declined based on whether a RoS was exercised - even by HMRC it only needs to be a right of substitution, it doesn't need to be exercised. If it has been exercised then I guess you would have a stronger case with HMRC.

[gingerjedi]

3) Take the role, declare yourself outside IR35 for this one, and hope that you avoid an investigation.

This one, but only because I'm not risk averse and the odds are still in my favour.

[northernladuk]

But the client will probably tell you to bugger off and the RoS will be shown to be a sham. It is of course probably a sham anyway but by clarifying you lose the safety of the grey areas in which many of us operate.

This is true but I would guess when the client says no is the key. It would be interesting to know what would happen if there has been no indication the RoS is a sham and the insurance investigation is on going and then the client turns round and says this even though it was never indicated or tested during contract. If the client turned round and said something wolly like 'it may have been possible' or 'refer to contract' then you still have an out.

[EternalOptimist]

All this going to the client for this or asking the client to clarify that seems totally wrong to me.

I always operated on the principle of giving the client zero or as little grief as possible. Making my problems into their problems ?? never

[Gittins Gal]

This is true but I would guess when the client says no is the key. It would be interesting to know what would happen if there has been no indication the RoS is a sham and the insurance investigation is on going and then the client turns round and says this even though it was never indicated or tested during contract. If the client turned round and said something wolly like 'it may have been possible' or 'refer to contract' then you still have an out.

Hmm, inneresting.

So really the outcome of any IR35 investigation is predicated on the whim of the client. Now, in my case I've worked for some pretty large outfits and the chances are that whoever was the entity representing "the client" when I was working there will no longer be in that role at the time of investigation. Indeed, they may have left the outfit altogether.

So, that conversation I had with him/her in which I was told that it would be feasible to use a substitute would presumably be overridden by the No Way Jose given by his/her replacement to the HMRC investigator.

[eek]

So, that conversation I had with him/her in which I was told that it would be feasible to use a substitute would presumably be overridden by the No Way Jose given by his/her replacement to the HMRC investigator.

correct...... and that's the way HMRC want it.....

[vetran]

there has always been no down side to the client, part of the problem with IR35.

[eek]

there has always been no down side to the client, part of the problem with IR35.

I repeat my comment immediately above yours

correct...... and that's the way HMRC want it.....