Reply to: Ministry of Justice role

[carlosLondon]

IPSe have been doing a lot of work behind the scenes on this whole issue. Word is that MoJ are opting out of using this form for Ltd Co contracts and have told Capita to stop using it. I suggest you go back the agency for them to get confirmation from MoJ that it is needed.

If you're an IPSe member ( and if not, why not? ) there's a discussion on it on their forums led by the guy who's been fighting this battle with CCS. A positive contract review from a recognised authority (QDOS, B&C, Accountax, whoever) should suffice.

thanks a lot. Apparently, at the moment, Capita is still asking for it. Not sure if MoJ will need that or not though...I am a + member of IPSE and have an IR35 insurance with QDOS, so I will get the contract reviewed asap.

thanks a lot
C

[malvolio]

Good morning

I am filling a CLOne Tax Assurance Evidence, and I am a bit confused about how to fill it - first time doing it, I've been on the private sector before...

I took the BET test and I am medium risk. I got the contract through an agency, which is the one that will be paying my invoices (I won't be paid directly by MoJ). I won't be on their payroll. I don't have a certificate from HMRC confirming I am out of scope for IR35, so my question is: should I tick the "Fully IR35 compliant" box? I am outside of IR35, as I have other work going on in parallel with the job I will be doing for the MoJ (and I took another IR35 test online with more questions and it said that my risk is low). The agent told me it's not relevant and that if something happens I just have to prove that I'm outside IR35. My issue is that I don't wanna send something to them saying I'm fully IR35 compliant and then telling my accountant that I am outside of IR35 in order to process the invoices.

I've had a quick look at the forums and I couldn't find an answer. If this has already been explained, could someone please send me a link/point me in the right direction?

Thanks a lot
C

IPSe have been doing a lot of work behind the scenes on this whole issue. Word is that MoJ are opting out of using this form for Ltd Co contracts and have told Capita to stop using it. I suggest you go back the agency for them to get confirmation from MoJ that it is needed.

If you're an IPSe member ( and if not, why not? ) there's a discussion on it on their forums led by the guy who's been fighting this battle with CCS. A positive contract review from a recognised authority (QDOS, B&C, Accountax, whoever) should suffice.

[carlosLondon]

CLOne Tax Assurance Evidence form

Good morning

I am filling a CLOne Tax Assurance Evidence, and I am a bit confused about how to fill it - first time doing it, I've been on the private sector before...

I took the BET test and I am medium risk. I got the contract through an agency, which is the one that will be paying my invoices (I won't be paid directly by MoJ). I won't be on their payroll. I don't have a certificate from HMRC confirming I am out of scope for IR35, so my question is: should I tick the "Fully IR35 compliant" box? I am outside of IR35, as I have other work going on in parallel with the job I will be doing for the MoJ (and I took another IR35 test online with more questions and it said that my risk is low). The agent told me it's not relevant and that if something happens I just have to prove that I'm outside IR35. My issue is that I don't wanna send something to them saying I'm fully IR35 compliant and then telling my accountant that I am outside of IR35 in order to process the invoices.

I've had a quick look at the forums and I couldn't find an answer. If this has already been explained, could someone please send me a link/point me in the right direction?

Thanks a lot
C

[SueEllen]

But that's kind of the point I was making - where clear unambiguous questions are being asked to determine status and to establish tax liability HMG can hold their hands up and say it's not our fault if the correct taxes haven't been paid, it's the contractor's fault; the contractor also then has little defence

Which leads to fun for lawyers.......

(The OP has insurance.)

[turbowoowoo]

Just out of deranged curiosity, if someone has a proforma of one of these contracts and sends it to HMRC for review.....

Anyone want to bet on the outcome?

Thing is DaveB, this contract is a Capita contract who exclusively deal with 'suppliers' therefore how could HMRC in reality challenge the clauses within these contracts? I think they would find it very hard.

there are two contracts one for limited company suppliers and one for temporary workers.

[LisaContractorUmbrella]

It always does. Under the rules for Self Assessment it's the individual that has to ensure they're paying the right amount of tax. If you have a defensible IR35-free contract and working arrangements, there's no issue.

But if you are dim enough not to realise that you are signing a contract of personal service either as an employee of someone other than YourCo or as a Schedule D SE, then yes, it could go all wrong. But that's your own fault for not understanding how to run your business properly.

But that's kind of the point I was making - where clear unambiguous questions are being asked to determine status and to establish tax liability HMG can hold their hands up and say it's not our fault if the correct taxes haven't been paid, it's the contractor's fault; the contractor also then has little defence

[DaveB]

Nope. It has no legal force and is not an indicator of IR35 status. Even if it were, given you have a solid contract and a positive review, how far do you think they'll get?

Just out of deranged curiosity, if someone has a proforma of one of these contracts and sends it to HMRC for review.....

Anyone want to bet on the outcome?

[malvolio]

Received the proforma contract they will draw up for my services today. it is the limited company contract, it has all the right clauses, substitution, even subcontract. indemnity liability etc and Qdos have approved this as being outside of IR35.

Although the working practices etc are still relevant as they are with all contracts it is the tax assurance form which worries me. will this be a red flag to the HMRC for investigation?

Nope. It has no legal force and is not an indicator of IR35 status. Even if it were, given you have a solid contract and a positive review, how far do you think they'll get?

[turbowoowoo]

Received the proforma contract they will draw up for my services today. it is the limited company contract, it has all the right clauses, substitution, even subcontract. indemnity liability etc and Qdos have approved this as being outside of IR35.

Although the working practices etc are still relevant as they are with all contracts it is the tax assurance form which worries me. will this be a red flag to the HMRC for investigation?

[CloudWalker]

I'd bet they will put you on PAYE but Let us know how you get on.

[malvolio]

But being a Ltd Co contractor doesn't define the tax position of the individual or their employment status come to that. Would there be penalties for the hiring agency for offering the wrong one? If not then the onus still falls on the contractor

It always does. Under the rules for Self Assessment it's the individual that has to ensure they're paying the right amount of tax. If you have a defensible IR35-free contract and working arrangements, there's no issue.

But if you are dim enough not to realise that you are signing a contract of personal service either as an employee of someone other than YourCo or as a Schedule D SE, then yes, it could go all wrong. But that's your own fault for not understanding how to run your business properly.

[LisaContractorUmbrella]

It's up to the hiring agency which one they offer. You would hope they know if they're dealing with an SE or with a Limited Company contractor.

But being a Ltd Co contractor doesn't define the tax position of the individual or their employment status come to that. Would there be penalties for the hiring agency for offering the wrong one? If not then the onus still falls on the contractor

[malvolio]

And how do they determine who should have which contract? IR35 tests as designed by HMRC which will be based on information provided by the contractor (which we don't don't reflect the correct legal position but that's neither here nor there). If the onus is on the contractor to pick one of two very clearly defined worker status' then there is no room for blame for HMG should it later transpire that the 'incorrect' status was chosen

It's up to the hiring agency which one they offer. You would hope they know if they're dealing with an SE or with a Limited Company contractor.

[LisaContractorUmbrella]

Except that the reworked CLOne contracts come in two flavours; self employed/agency worker (including incidentally those occupying substantive positions within the organisation, which is what started this all off in the first place) and independent freelances who are in business on their own account and working via an agency. They can't now step back and say that both should be taxed the same, else why have two distinct contractual options?

The question of being in or out of IR35 is still valid of course, and the usual rules apply, hence the need for a positive review by an expert (and the BET score, of course, which are widely regarded as nonsense anyway). But you can't conflate that with some mystical attempt to change tax laws unilaterally.

And how do they determine who should have which contract? IR35 tests as designed by HMRC which will be based on information provided by the contractor (which we don't don't reflect the correct legal position but that's neither here nor there). If the onus is on the contractor to pick one of two very clearly defined worker status' then there is no room for blame for HMG should it later transpire that the 'incorrect' status was chosen

[malvolio]

I kind of agree with BB - it's obvious that a Government so obsessed with tax avoidance can't afford to get caught with its pants down again so I think it will make sure that its processes for recruitment are absolutely water tight. If a contractor signs something to say that they will pay their 'fair share of taxes' and they are seen to go through a rigourous IR35 status checking procedure then HMG are in the clear. Should it then come to light that their procedures slipped up and individuals were deemed not to have paid their 'fair' share HMG will be able to, self-righteously, throw HMRC's book at them.

(does anyone else feel that the words 'Government' and 'fair' don't really sit well together?)

Except that the reworked CLOne contracts come in two flavours; self employed/agency worker (including incidentally those occupying substantive positions within the organisation, which is what started this all off in the first place) and independent freelances who are in business on their own account and working via an agency. They can't now step back and say that both should be taxed the same, else why have two distinct contractual options?

The question of being in or out of IR35 is still valid of course, and the usual rules apply, hence the need for a positive review by an expert (and the BET score, of course, which are widely regarded as nonsense anyway). But you can't conflate that with some mystical attempt to change tax laws unilaterally.