Staying in the same public sector contract after April 2017

[BoredBloke]

Where do you get the idea that a new contract is coming, that's an assumption that may or may not be valid?

Equally given that you are now inside, whilst QDOS may be willing to fight for you the battle will be different from what they've had to fight before... Have they successfully won cases in the past where a contract moves from outside to inside due to decisions made by the end client? some how I doubt it....

But surely the real status still depends on case law. Previously the contractor determined the IR35 status and HMRC disagreed with it and the case was tried in the courts/tribunal, with a low success rate on the part of HMRC. Now the client is making the decision based on some biased yet to be released tool and obviously being cautious. Surely the route to the tribunal is still a valid option. The underlying case law has not changed, so there is still a fair chance of being outside ir35 so long as the contracts and working practices support it. There is also the point that if you have been working outside and have documented proof to show that you and outside, when the client suddenly determines that you are inside surely there is a case to show that their decision is wrong.

Obviously I wouldn't like to be in this position and given the choice, I'd look to jack it in and go to the private sector

[Semtex]

But surely the real status still depends on case law. Previously the contractor determined the IR35 status and HMRC disagreed with it and the case was tried in the courts/tribunal, with a low success rate on the part of HMRC. Now the client is making the decision based on some biased yet to be released tool and obviously being cautious. Surely the route to the tribunal is still a valid option. The underlying case law has not changed, so there is still a fair chance of being outside ir35 so long as the contracts and working practices support it. There is also the point that if you have been working outside and have documented proof to show that you and outside, when the client suddenly determines that you are inside surely there is a case to show that their decision is wrong.

Obviously I wouldn't like to be in this position and given the choice, I'd look to jack it in and go to the private sector

I agree in a way with you.

I don't think HMRC's IR35 prosecution stats will improve dramatically, but two things will happen

1, the amount of tax they receive will increase as people/organisations work under ir35 rules
2, the stress caused by an investigation (even if you are most likely going to win your case) will be the incentive to keep under the radar.

only the foolhardy will want to become a name of their hit list

[difficulttimes]

Petition

I see the petition that has been on Linkedin is now well over 10 000 signatures against the new changes. This was only 1000 odd last week and considering there are only 18-20k contractors in the PS market that is quite a phenomenal figure and shows how concerned the wider industry is... of course I know it won't do anything but it shows that thousands of people will be impacted by this.

[BoredBloke]

I agree in a way with you.

I don't think HMRC's IR35 prosecution stats will improve dramatically, but two things will happen

1, the amount of tax they receive will increase as people/organisations work under ir35 rules
2, the stress caused by an investigation (even if you are most likely going to win your case) will be the incentive to keep under the radar.

only the foolhardy will want to become a name of their hit list

I totally agree with what you say, which is why I added that last line. But will their tax increase...A fair chunk will leave. Of these some will get work, some won't. Yes they will get a higher percentage of the contractors income for those who stay, but the same percentage for those who get work outside the public sector and nothing from those who can't get work.

There needs to be some kind of test to show the ESS tool to be the biased sham that it is expected to be. This tool will be giving a yes no answer to a very complex legal position and it's obviously going to be weighted in the favour of HMRC. It's like asking a junkie if he'd like a bit more crack. Only the most obviously outside IR35 roles are going to come out with an outside IR35 result. That's not how things stand in the real world when you look at the stats that HMRC have managed up to now. And it's worth bearing in mind, that HMRC would have fought these on the basis that they thought that these were winnable cases. My guess is all of the roles they lost at tribunal would come out as inside ir35 when tested against their tool.

[eek]

I agree in a way with you.

I don't think HMRC's IR35 prosecution stats will improve dramatically, but two things will happen

1, the amount of tax they receive will increase as people/organisations work under ir35 rules
2, the stress caused by an investigation (even if you are most likely going to win your case) will be the incentive to keep under the radar.

only the foolhardy will want to become a name of their hit list

+1. The other bit to add is that this would now be a political issue as much as a legal one and politically the department is going to do everything it can to protect its current decision to avoid

• the political fallout that would destroy the careers of any civil servant involved
• what could potentially be a very large bill

Can I add the more I look into this the more impressed I am with both how Machiavellian and how completely thought through the scheme is.

The implementation and communication is however following the usual Keystone Cops approach which these thing inevitably have.

[BoredBloke]

I see the petition that has been on Linkedin is now well over 10 000 signatures against the new changes. This was only 1000 odd last week and considering there are only 18-20k contractors in the PS market that is quite a phenomenal figure and shows how concerned the wider industry is... of course I know it won't do anything but it shows that thousands of people will be impacted by this.

I was about to post something about that myself. It's quite a rise in numbers. But you have to look at the wider implications to this. It doesn't just hit the contractor, it hits their family. It hits the recruitment and accountancy industries and it hits the public sector in terms of their ability to deliver.

It should also hit the Tories. They once promised to repeal this but instead having given us Gordon browns wet dream. There is literally no way that I will ever vote for the Tories because of this. How many PSC contractors are there in the UK? Add to that their families and it's a hefty number of votes the Tories have discarded.

[eek]

I see the petition that has been on Linkedin is now well over 10 000 signatures against the new changes. This was only 1000 odd last week and considering there are only 18-20k contractors in the PS market that is quite a phenomenal figure and shows how concerned the wider industry is... of course I know it won't do anything but it shows that thousands of people will be impacted by this.

And I look at those figures and think hmm perhaps HMRC are right....

[BoredBloke]

+1. The other bit to add is that this would now be a political issue as much as a legal one and politically the department is going to do everything it can to protect its current decision to avoid

• the political fallout that would destroy the careers of any civil servant involved
• what could potentially be a very large bill

Can I add the more I look into this the more impressed I am with both how Machiavellian and how completely thought through the scheme is.

The implementation and communication is however following the usual Keystone Cops approach which these thing inevitably have.

Agreed - just thought it was worth pointing out that the underlying case law has not changed and that this decision by the client is obviously going to be based on a dodgy biased and over simplistic tool and their cautious risk averse nature. For their inside decision to stand they will have to ensure that their working practices and contracts match an inside status.

[difficulttimes]

And I look at those figures and think hmm perhaps HMRC are right....

I probably shouldn't ask but why do you say that?

[eek]

I probably shouldn't ask but why do you say that?

Because people are greedy and that survey is more woe is me than anything constructive.

Now I'll be blunt here but while I dislike HMRC's approach the level of blatant abuse I saw when in the public sector last year was so great that something had to be done.