Lloyds show their IR35 hand.....

[Lance]

I quite agree Lance, but they have made a policy decision ("There is NO CEST assessment being undertaken", "this is simply being communicated as a new method of engagement for PSC"), so they will have to keep very quiet about those who they deal with differently.

Have you seen a NDA winging your way yet??

I haven't. I don't expect one. My client is public sector and seems to be making these decisions about 2 years too late

[cojak]

I haven't. I don't expect one. My client is public sector and seems to be making these decisions about 2 years too late

[SandyD]

The only way to force the banks to review their position is what the public sector contractors did, so now even HMRC are advertising contracts outside the IR35....

I think if the contractors refuse and stand their grounds, like finding contracts in smaller companies/ consultancies where IR35 does not apply, avoiding contracting direct to banks, we will see some changes.

Why not contract for a small consultancy that in turn contracts for the bank and changes the bank double the amount if the contractor contracted direct to them?? That would teach them !!

btw is the IR35 threshold applies for contracting for companies less than 5K employees?? Am I right??

[BlueSharp]

Make no mistake - they HAVE made a decision that contractors are INSIDE IR35.

Using umbrellas is simply a result of that decision (you can’t be outside AND use an umbrella).

They’re just too cowardly to admit it.

By making no determination they are hoping contractors will switch and not leave.

[northernladuk]

The only way to force the banks to review their position is what the public sector contractors did, so now even HMRC are advertising contracts outside the IR35....

They did? I think you might be mistaken there. In fact I'm sure you are. Contractors did not force them to do this. Even less chance it would work for the banks as well.

I think if the contractors refuse and stand their grounds, like finding contracts in smaller companies/ consultancies where IR35 does not apply, avoiding contracting direct to banks, we will see some changes.

Refuse and stand their ground? You mean leave? 1500 contractors alone at GSK. How many small consultancies do you think there are out there?

Why not contract for a small consultancy that in turn contracts for the bank and changes the bank double the amount if the contractor contracted direct to them?? That would teach them !!

Utter rubbish.

btw is the IR35 threshold applies for contracting for companies less than 5K employees?? Am I right??

Well your initial comments, although wrong, would give the impression you've done enough research to take such a firm stand and then you ask a question which is very well defined and discussed at length all over the place. Why not go find out. Makes it very difficult to take anything else previously seriously when you end a post with that question.

[WordIsBond]

It's the obvious solution.

If you make blanket inside determination, you run the risk of getting hauled before an employment tribunal (there, I said it for you, JTB, you don't have to say it). They don't want that risk. You also risk getting into arguments with contractors and having to spend money defending inside determinations.

If you make case-by-case determinations, you run the risk of getting it wrong sometimes, with all the liability that entails. You also end up having to put in place a procedure for contractors to dispute your determination. Perhaps most egregious, you have to train people to make a determination that HMRC themselves often get wrong. And, you run the risk, on those where you make an inside determination, of facing an ET.

Businesses don't want all that extra hassle.

And it's actually not the worst thing that could happen to the contractors. The worst thing would be an inside determination that HMRC could use as a weapon in historical cases, too.

You just have to hope that enough clients will work with contractors to structure a significant market of outside contracts. If you get that, then you get a two-tier market, and whatever Lloyds and others are saying right now, that will result in different rates for inside and outside. Market forces will win, they always do -- but only if there are enough clients who are willing to compete for the best by offering outside roles.

[SandyD]

NLUK, I am working abroad at the moment, been for a while, so haven't followed in details with all the Brexit mess... I am working through a 3rd party payrolll as working with Ltd in this country not allowed, however, tax are low here plus rates are higher than the UK, so its working out.

Am thinking this model could also work in the UK, I am to be honest was getting very very fed up the last couple of years of earning money into my Ltd, and not being able to use it as I have other income from rental, they reduced my dev allowance, and everything I take is taxed at higher rate, it was becoming a viscous cycle for me, and couldn't see the point of working earning good rates, and not being able to spend the money without paying half of it in tax, now at least I get the money direct into my personal, after the tax which is deducted as source, I get very decent money direct into my personal usage which is more or less equivalent to what I was earning through ltd after company tax (but before SA), so I do not need to take salary/loan/ accountant and complicated ltd structure... for the last two years, its been very tough in the UK to balance the accounts, in spite of having the cash in the bank... but it was untouchable, and before you say I have rental income, the expenses of running the rentals plus them stopping the mortgage being expenced has eaten away mos to of the profit !!

So to me if this model used abroad, also used in the UK I would be OK with it, as long as the rate / net amount I got end of the day is fine. But with the high tax rate in the UK, not sure how it will work... unless Javid really does raise the threshold to 80K !

[CryingSheep]

Was indeed Lloyds.

I’ve said on here a number of times that I didn’t think the large organisations will throw contractors under a bus and blanket go inside IR35 or in fact make the effort in assessing whether outside. Instead they will take easiest path and do this. There’s so many different working practices, some people will be inside some outside, even with the same job title. It’s impossible to manage.

Taxman is going to get his way it seems.

If giving those 3 options is not throwing contractors under a bus, I don't know what it is...

[Antthe]

I know one big client Co is still looking at a managed service model - they should be coming out shortly with their plans to their contractors. I'm not sure this will be the official line though - they may well come out with something similar to Lloyds and Barclays while still engaging contractors outside through a managed service model with compliant outside working practices.

Sent from my CLT-L29 using Contractor UK Forum mobile app

[JohntheBike]

It's the obvious solution.

If you make blanket inside determination, you run the risk of getting hauled before an employment tribunal (there, I said it for you, JTB, you don't have to say it). They don't want that risk. You also risk getting into arguments with contractors and having to spend money defending inside determinations.

If you make case-by-case determinations, you run the risk of getting it wrong sometimes, with all the liability that entails. You also end up having to put in place a procedure for contractors to dispute your determination. Perhaps most egregious, you have to train people to make a determination that HMRC themselves often get wrong. And, you run the risk, on those where you make an inside determination, of facing an ET.

Businesses don't want all that extra hassle.

And it's actually not the worst thing that could happen to the contractors. The worst thing would be an inside determination that HMRC could use as a weapon in historical cases, too.

You just have to hope that enough clients will work with contractors to structure a significant market of outside contracts. If you get that, then you get a two-tier market, and whatever Lloyds and others are saying right now, that will result in different rates for inside and outside. Market forces will win, they always do -- but only if there are enough clients who are willing to compete for the best by offering outside roles.

(there, I said it for you, JTB, you don't have to say it)

thanks and I generally agree with the rest of your post, especially this -

Market forces will win, they always do

it just remains to be seen how long it will take before this happens.