IR35 Inside/Outside same supplier and ways of working? What to do?

[dave748]

So I'm hoping someone can help shed some light on a situation I'm currently in. I recently renewed a contract with a client but they were adamant that my contract was INSIDE IR35. I disputed it on several grounds but they refused to budge, in the end, I accepted the contract INSIDE but, still maintain it should be OUTSIDE. Recently I found out that another contractor for the same client who works in an identical manner to myself was offered an outside contract renewal.

This has infuriated me so I posed the question as to why? They said they'd get back to me, still waiting.

Where do I stand with this situation? Do I have legal grounds to challenge the determination at this point, based on the fact that two contracts working in an identical manner have different determinations?

What legalities exist that I can lean on in this situation?

Any advice would be most welcome.

Thanks in advance
Dave

[cojak]

If the company does review both contracts I suspect that they will put the other contractor on an inside IR35 contract.

That way both contracts will align.

[dave748]

If the company does review both contracts I suspect that they will put the other contractor on an inside IR35 contract.

That way both contracts will align.

Maybe but, I suspect one of the driving factors behind placing the contract OUTSIDE, which it probably should be anyway, was to prevent the encumberment from leaving the role. If they put it INSIDE, he will leave and take his knowledge and experience with him, which to be quite frank they can't afford to lose.

[ladymuck]

Just because you don't like it, doesn't make it illegal. The client has a legal requirement to assess each role and make a status determination. You are then paid according to that determination.

You can appeal the decision, which is what you've already done. If they reject your appeal your options are to suck it up or walk.

Your fellow contractor may not thank you for highlighting an inconsistency in their process as, as Cojak says, it's highly likely they will move them to an inside contract and they'll have a nice tax bill to contend with on top of a drop in income.

There is a chance they will see the error of their ways and change you to an outside determination. I wouldn't hold my breath though.

[dave748]

Just because you don't like it, doesn't make it illegal. The client has a legal requirement to assess each role and make a status determination. You are then paid according to that determination.

You can appeal the decision, which is what you've already done. If they reject your appeal your options are to suck it up or walk.

Your fellow contractor may not thank you for highlighting an inconsistency in their process as, as Cojak says, it's highly likely they will move them to an inside contract and they'll have a nice tax bill to contend with on top of a drop in income.

There is a chance they will see the error of their ways and change you to an outside determination. I wouldn't hold my breath though.

Thanks but,

Surely, if the determination is incorrect and it should be OUTSIDE based on the fact the other contract is, even after an internal appeal had not changed the determination there must be actual legal grounds to challenge the determination externally from the organisation. As you said they have a "legal requirement" to ensure it is correct, well, who enforces that legality and how would I invoke a challenge to the determination based on the fact that they have not fulfilled that legal requirement correctly and made an incorrect determination which I am now paying for.

[eek]

What exactly are you trying to achieve here as all I see is someone trying to screw things up or an innocent 3rd party.

[dave748]

What exactly are you trying to achieve here as all I see is someone trying to screw things up or an innocent 3rd party.

I'm trying to get the determination I believe to be correct, not the one I have which I believe to be incorrect. I don't think for a second I'm "screwing things up" for an important party as they already have the correct determination, so won't be affected.

What would you do, honestly, sit back and think:

"Never mind, I'll pay the extra tens of thousands of pounds in TAX that I shouldn't be while contractor x over there working OUTSIDE in an identical manner continues running his Ltd company and all the benefits that go with it."

Anyone with half a brain cell would be doing exactly what I'm doing and trying everything possible to get the correct determination.

[eek]

I'm trying to get the determination I believe to be correct, not the one I have which I believe to be incorrect. I don't think for a second I'm "screwing things up" for an important party as they already have the correct determination, so won't be affected.

What would you do, honestly, sit back and think:

"Never mind, I'll pay the extra tens of thousands of pounds in TAX that I shouldn't be while contractor x over there working OUTSIDE in an identical manner continues running his Ltd company and all the benefits that go with it."

Anyone with half a brain cell would be doing exactly what I'm doing and trying everything possible to get the correct determination.

What would I do? Leave and find another contract as you aren't happy.

You are not going to get an outside determination

[dave748]

What would I do? Leave and find another contract as you aren't happy.

You are not going to get an outside determination

I can't disagree with that, and that is probably what I will end up doing but, I hate the injustice of the situation and the incompetence of the people running the show. I actually like the work and I know if I leave now I will make it very difficult for the customer who doesn't deserve it. I'm not one for running away from a situation, I'd rather stand my ground on what is morally and legally right first.

I'm not really looking for opinions on what others think I should do in terms of staying or going. I'm looking for advice on how to make things right for myself using the correct and legal procedures and using the legalities in place to allow that challenge of an incorrect decision. If no one was to ever challenge these things what's the point in there being a legal requirement to ensure determinations are correct in the first place?

[jamesbrown]

he will leave and take his knowledge and experience with him, which to be quite frank they can't afford to lose.

There you have it, value talks. You're not considered sufficiently valuable for them to take the risk, and it's a risk (to them), ultimately.

There's no way you'll get an outside determination and you have no (or very unclear) legal recourse (the client-led status disagreement process has only one possible outcome), so you can either accept it or leave, and no one here can make that call for you.