Castlemaine's workaround for IR35 (Partnerships)

[Tiger22]

Just received an unsolicited email from Castlemaine Associates (that company name immediately makes me wary) saying:

"If your client has informed you that you will be caught under the new Off Payroll Working Rules and you will need to work via a PAYE Umbrella... there is another way!"

with a "Click for Info" button.

That takes you to a page titled "Partnerships are the new PSC's " offering a solution via Partnerships where you are all self employed and where a "self-employed partner will pay class 2 and 4 National Insurance which amounts to a considerable saving when compared to PAYE umbrella. You will also be able to offset all genuine business expenses and capital assets."

Sigh. Please tell me I am right in thinking this is an IR35 dodge which will land any participants potentially in future hot water. I'm not touching it for sure.

[ladymuck]

It's not called XXXX for nothing

[jamesbrown]

Like the Castlemaine, I'm not bitter...

...until I get a full rectal examination from HMRC.

(for anyone wondering, it's total crap and IR35 is probably the least of your worries, although it does apply to partnerships, in principle)

[cojak]

Castlemaine - hmmm... that rings a bell.

*flick through Rolodex"

Ah yes, here we are....

https://www.contractoruk.com/forums/...ht=Castlemaine

PS - Sorry to say but they might have got your contact details from a Sucker's List.

[northernladuk]

Filed under 'don't touch with bargepole' then.

[DealorNoDeal]

"Son of IR35" is going to spawn a lot of this type of crap.

It's a gift from the Gods to the scam merchants.

[webberg]

An observation.

Merely claiming that you are self employed, does not make it so.

This applies to all parties who have an interest in that question and answer, including HMRC.

Self employment is a state arrived at after examining all the facts of a particular situation.

Space is too short here to go over the relevant cases.

If there is a claim for self employment, no doubt HMRC will show an interest. Therefore establishing the correct conditions at the outset and paying attention to them on a constant and diligent basis will be a minimum requirement.

I can see that there will be some situations in which small teams of contractors presently engaged by one organisation would be suitable candidates from grouping into a partnership. However the transition will require some thought and due diligence.

This process will also involve contractors going through a change in mind set from "worker on a day rate" to "partner with responsibilities and perhaps potential liabilities beyond their immediate control". It's a leap in thinking.

Applying these sort of changes to process and thinking would be sensible in some scenarios but it is (in my opinion) unlikely to be suitable for a mass market application across as many differing sets of circumstances.

And as said above, HMRC is certain to show an interest.

Caveat emptor - with bells and whistles on.

[DealorNoDeal]

I'm no longer contracting but if I was I think I'd just accept the situation, go with a brolly, and use pension contributions to reduce the tax.

Btw, just out of interest, apart from making pension contributions, are there any other 100% legit ways of reducing income tax or nics?

[Grasser73]

I'm no longer contracting but if I was I think I'd just accept the situation, go with a brolly, and use pension contributions to reduce the tax.

Btw, just out of interest, apart from making pension contributions, are there any other 100% legit ways of reducing income tax or nics?

There is salary sacrifice but not sure how much in % terms it applies.

[eek]

There is salary sacrifice but not sure how much in % terms it applies.

Salary Sacrifice to where beyond for pensions?

As for this scheme keep as far away as humanly possible. People will however go for these type of schemes due to greed (as shown numerous times since 2001) unless agencies explicitly stop them.