Results of the public sector consultation is up

[eek]

So treated as a contractor, taxed as an employee. No employee benefits. I'm actually struggling to understand how this is legally sound. I see a lawsuit in the not too distance future. You can't have your cake and eat it. Look at the shenanigans in the Supreme Court today.

It's already been done in the Construction Industry (search for CIS).. It's interesting that the first people IPSE talked about in Stek's email are specialist CIS accountants.

[seeourbee]

What's been done ? This tax or a legal challenge ?

[DotasScandal]

it will be up to the PS department to make de decision and if some managers takes the plunge and declare that you are outside IR35

Pray tell, what would be the rationale for a manager taking such a plunge?

[DotasScandal]

So even private sector is screwed if this online tool makes it nigh on impossible to pass.

Bravo.

[LondonManc]

Pray tell, what would be the rationale for a manager taking such a plunge?

To attract the calibre of contract actually capable of doing the job?

[DotasScandal]

To attract the calibre of contract actually capable of doing the job?

You think a manager would actually take the risk of guaranteeing IR35 status?
I'll eat my hat it that happens.

[sal]

Pray tell, what would be the rationale for a manager taking such a plunge?

Saving an IT department of 50%+ contractors from a total collapse?

It all depends on what the online test/check tool will look like. A lot of the IT managers in the PS are pretty aware of the consequences if all their contractors are branded inside IR35. If they have to change some of the work practices, fiddle some numbers etc. to satisfy the tool and deem his contractors outside IR35 and keep them on board, without busting their budget they will do it.

The potential NI/Tax liability will not come out of their budget and they can play "dumb".

[seeourbee]

This is the end of the road for me unfortunately. All PS ir35 decisions will result in being taxed as Paye. So on £100k turnover you're talking about an extra £20k gone instantly in tax (rather than keeping the cash in the company). For me that's it, my business model is finished. Still struggling to believe how this is legally possible , but I guess the Government can do what Th heck it likes.

[sal]

You think a manager would actually take the risk of guaranteeing IR35 status?
I'll eat my hat it that happens.

I'm currently in a contract at an University. The department head ensured all contractors that regardless what happens come April 2017 we are not going to be left "out of pocket" and if the upcoming legislation deems us inside IR35 the rates will be adjusted to mitigate the added cost keeping us at the same level of take home pay as before. Whether or not they are capable of doing the correct calculation for everyones circumstances is irrelevant. The important bit is they are ready to foot the PAYE/NI bill as is.

Now imagine if they have a choice on the matter to declare us outside and save all the extra cost on the spot while making their contractors extremely happy to stay on. Worst case scenario somewhere down the line HMRC knocks on their door asking for the PAYE/NI, they will pay it regardless.

[seeourbee]

Results of the public sector consultation is up

Have they even addressed double tax relief ? So you're going to be paying 40% income tax on your turnover already, so ... what .. the remainder becomes your new turnover .... on which you pay corporation tax, income tax in your company salary and dividend tax on your dividends. I don't think there's any cash left over there ?!