IR35 PS - So anyone had the discussion yet?

[daemon]

I'm just starting to have these discussions at the moment (been hassling them for a while now). I think that a lot of agencies will probably have a liability clause in their contract to pass that cost onto the contractor in some way.

Without doubt IMHO.

It'll come out of your pay.

Surely thats the way umbrella companies work at the min?

[cojak]

IR35 PS - So anyone had the discussion yet?

Yes it is. That's what 'inside IR35' means. The public sector and umbrellas will work to the rules.

[daemon]

Yes it is. That's what 'inside IR35' means. The public sector and umbrellas will work to the rules.

Yes. i know that.

I meant the employers NI is paid by the contractor out of their day rate via the umbrella company.

Hence this notion that its going to come out of the agencys 10% is misguided.

Once you go via an umbrella or direct agency payroll, the 12% Employers NI will be taken directly from the contractor.

[teapot418]

Yes. i know that.

I meant the employers NI is paid by the contractor out of their day rate via the umbrella company.

Hence this notion that its going to come out of the agencys 10% is misguided.

Once you go via an umbrella or direct agency payroll, the 12% Employers NI will be taken directly from the contractor.

The agency will need to pay the employers' NI.

If the contract does not already allow for them to deduct it from the contractor, they will need to renegotiate contracts either with the contractor or the end client. It'll be an interesting one, for sure.

[bobspud]

The agency will need to pay the employers' NI.

If the contract does not already allow for them to deduct it from the contractor, they will need to renegotiate contracts either with the contractor or the end client. It'll be an interesting one, for sure.

But like everyone else you make the assumption that the contractor will stay...

The overwhelming fear in the departments right now is that they will lose their hard earned skilled specialists because of this mess and the last thing they want to do right now is let an agent pour petrol on it by demanding an even bigger cut to the end supplier.

In other news I heard a rumour the other day that TFL had an identical finding to UKHO with respect to so who's staying for a tulip sandwich and are now privately running around with their hair of fire and a soon to be completely empty bench of talent. There is a silver lining to this though as I believe they will be consulting a well known 4 letter acronym
with regards to who was actually caught because it would seem the departments are all going to turn on HMRC and far from do their bidding are actually fetching their own lawyers much like the private sector will.

[psychocandy]

Or, rather more likely they take their fees from the client, pay off the ErNICs then give you your margin of the balance...

You get a percentage of their income, not the other way round. However agencies already offer two rates to clients to cover umbrella users' NIC overheads, no reason they won't simply switch to the higher rate fee.

Yes I agree but that needs to in the contract. There seem to lots of agencies/contractors sleepwalking into this.

Rememeber, this is likely to affect work done in three weeks time - for payment in April. I can see a lot of contractors working MArch getting paid April and then it hits.

Agency may well have already paid this money out. I just dont see the agencies making much effort at the moment. Like I said, mine just said "nah you're ok"

[psychocandy]

Had a conversation with an agent about a new contract with an agent on Friday. They told me client and I said "Isn't that public sector?".

At the moment, It seems that agencies/clients are just clueless - although I wouldnt put it past agents being deliberately stupid. Of course, none of this helped by HMRCs half arsed plan anyway.

Agent did not have a clue. Isnt there a list somewhere?

[northernladuk]

Had a conversation with an agent about a new contract with an agent on Friday. They told me client and I said "Isn't that public sector?".

Agent did not have a clue. Isnt there a list somewhere?

It seems its not just the agent from that post....

http://forums.contractoruk.com/showthread.php?t=119119

[avalon111]

B
In other news I heard a rumour the other day that TFL had an identical finding to UKHO with respect to so who's staying for a tulip sandwich and are now privately running around with their hair of fire and a soon to be completely empty bench of talent. There is a silver lining to this though as I believe they will be consulting a well known 4 letter acronym
with regards to who was actually caught because it would seem the departments are all going to turn on HMRC and far from do their bidding are actually fetching their own lawyers much like the private sector will.

I don't think HMRC will tolerate any concerns about the legislation from TfL.

Sadiq Khan made it a key plank of his post Election strategy to cut the off-payroll workers at TfL, characterized by his interview in July last year;

He said: “I am determined to bring the number of agency workers at TfL down as part of the root-and-branch review I have ordered.”

TfL declined to say how many of the temporary staff were paid via “personal service” companies, which allow income tax and national insurance to be avoided.

There were 2480 agency staff during the 2014/15 financial year, on average, while the number paid through personal service companies was 2,296 in December 2015.
https://www.ft.com/content/a1b5d18c-...8-72e9211e86ab

The Mayor has boxed himself and TfL in with this; HMRC are delivering precisely that he has demanded and he can't really blanch at the prospect of too many contractors now determining to leave (most likely engineers, retiring).

If there is an exodus; and the second letter suggests there is one underway, then some or all of the projects listed on this page are likely to be most-at-risk from seeing even a small proportion of the 2000+ contractors being persuaded by TfL's suggestion to walk away:

https://tfl.gov.uk/travel-informatio...-and-projects/

If operations as well as projects are impacted, then the first casualty will be The Night Tube, recently introduced on the Victoria and Jubilee lines, and most of the Central, Piccadilly and Northern (Charing Cross) lines. Running a 24-hour Underground depends hugely on maintenance, planning and change resources. If any of these are impacted, even for a short time, then the likely damage is likely to be felt for some months/years, as it won't be easy-to-recover. In all likelihood TfL will have to abandon The Night Tube inside the next few months.

They'll be no respite coming from HMRC though; Khan demanded action against TfL's own contractors...and got it!

[SueEllen]

The Mayor is a Labour one and Labour are backed by unions who believe people should be employees.

I've seen London councils taken to task over the years for hiring temps long term. Even central government departments have.