The Review and "Retro" IR35 Investigations

[WordIsBond]

So far I think it was believed that no determination=ban PSCs was better that inside determination.
With this new POV what is the silver bullet for a contractor when they are offered PAYE - umbrella or employment? Change agency? Other?

The only silver bullet is to have iron-clad evidence that your pre-April role was outside.

No determination/PSC ban is possibly better than inside determination but I've argued in the OP that HMRC may well end up pursuing them on the same basis. If I were staying I'd certainly rather stay via brolly than inside.

Employment is safer than brolly, IMO. There's then no third party (agency) in between, it's clearly a different relationship even if the role is similar. Contractors have been offered employment, and taken it, forever. Guy comes in, does a job, client says, "Hey, we could use someone with your skills permanently, here's an offer," and he accepts. I hired two contractors as perms back in my perm mgmt days.

If you stay brolly at least change agency if you can, that lessens the risk that they'll match up before and after. IMO.

If you stay inside in any of these ways I would definitely close the company, it also helps mitigate the risk. IMO.

[ComplianceLady]

interesting this ... so do you think a statement from the client stating (in bold) that would be of benefit and is worth pushing for ... certainly be something to file away with the insurance in my closed company file !

My personal view is that it's worth getting. I would say that clients should only issue an SDS for outside. If they think a role is inside post April then they should terminate giving reason as 'Change to working practices' and offer a new umbrella/PAYE contract. It's not cast iron but I think it leaves contractors in a better position.

[CanPayButWouldRatherNot]

I've spoken to clients about this - how you can say from April we want to offer you contract X but this has no bearing on your current contract. Those that value contractors and are more on the medium sized end of the spectrum are happy to manage this in a way that doesn't expose contractors to more risk. Some don't care.

interesting this ... so do you think a statement from the client stating (in bold) that would be of benefit and is worth pushing for ... certainly be something to file away with the insurance in my closed company file !

[eek]

The risk here I think is more what the client would say. HMRC can say it's an inside determination on the pre April contract but if the client puts in writing that it's actually to avoid the IR35 process (which some have) then HMRC's argument is moot.

I've spoken to clients about this - how you can say from April we want to offer you contract X but this has no bearing on your current contract. Those that value contractors and are more on the medium sized end of the spectrum are happy to manage this in a way that doesn't expose contractors to more risk. Some don't care.

I've also spoken to HMRC recently about the retro action approach and they do seem focussed on going forward and tackling clients who are deliberately dodging the rules - they want to ensure this doesn't slip into a change for 6 - 12 months then back to normal. Right now it seems it would be counter-intuitive to upset contractors at clients who are being more 'compliant'.

In my experience though that picture changes very quickly and I would put absolutely no faith in policy statements or similar.

HMRC have 4 years to query tax payments. The next 6-12 months is irrelevant when there are another 3 years to play with especially as HMRC will over time start chasing people who no longer have the appropriate original paperwork due to time.

[ComplianceLady]

The risk here I think is more what the client would say. HMRC can say it's an inside determination on the pre April contract but if the client puts in writing that it's actually to avoid the IR35 process (which some have) then HMRC's argument is moot.

I've spoken to clients about this - how you can say from April we want to offer you contract X but this has no bearing on your current contract. Those that value contractors and are more on the medium sized end of the spectrum are happy to manage this in a way that doesn't expose contractors to more risk. Some don't care.

I've also spoken to HMRC recently about the retro action approach and they do seem focussed on going forward and tackling clients who are deliberately dodging the rules - they want to ensure this doesn't slip into a change for 6 - 12 months then back to normal. Right now it seems it would be counter-intuitive to upset contractors at clients who are being more 'compliant'.

In my experience though that picture changes very quickly and I would put absolutely no faith in policy statements or similar.

[LondonManc]

If they start offering a percentage on the returns that's going to be my plan B

You've got a bus lined up to throw them under?

[northernladuk]

An email, not too far in the future.....


Can't see it ending well.

If they start offering a percentage on the returns that's going to be my plan B

[BrilloPad]

An email, not too far in the future.....


Can't see it ending well.

Because snitches get stitches?

[LondonManc]

An email, not too far in the future.....

FROM: thegrass@ resourcesolutions.co.uk
TO: insideir35snitchline@ hmrc.gov.uk
ATTACHED: ContractorList.xlsx
SUBJECT: Contractor List

Hello,

Please find attached the list of low-hanging fruit that you wanted from our banks on the wharf. Good hunting.

Best regards,
Snitchy McSnitchface.

Can't see it ending well.

[Paralytic]

So far I think it was believed that no determination=ban PSCs was better that inside determination.
With this new POV what is the silver bullet for a contractor when they are offered PAYE - umbrella or employment? Change agency? Other?

Doesn't really matter. If you have contract/working practices reviewed, showing you outside IR35, and have insurance in place, extract cash from PSC, close it down, carry on with life. If you're risk averse, keep money aside in a safe place to cover the potential tax in case HMRC try to play the fraud card.