Reply to: Worst case scenario

[SueEllen]

Does anyone know what's going to happen to the travel industry when we all start working remotely?
Since we won't want to pay tax on T&S.

Smaller B&Bs will go out of business unless they have enough summer bookings to keep them going.

The larger hotel chains will be fine.

[darrylmg]

Does anyone know what's going to happen to the travel industry when we all start working remotely?
Since we won't want to pay tax on T&S.

[Would rather not be named]

Time to chase direct leads more? Perhaps clients will be more receptive to direct contracts faced with the prospect of higher rates to compensate for IR35. The death of recruitment agencies for contracting perhaps?

Can't see it. Where I live companies are as a growing trend seemingly recruiting increasingly and in other cases solely via agencies.

[jamesbrown]

See my comment earlier on.

When this was first mentioned S44 explicitly excluded PSCs and PSCs were excluded from the expenses discussion document.
Now in the consultation S44 has reappeared with no document exclusing PSCs and PSCs are included in the expenses discussion.

It may be an oversight. It may not be...

There's no oversight. The IR35 discussion document (and possibly the expenses consultation too?) explicitly notes that some recent representations pointed to 'risks of incorporation that the legislation on false self-employment might be having' (to paraphrase). It was a straightforward shift in position following the representations made. If that's what you're saying too, I agree. However, I'm still not sure this matters because PSCs are in-scope for IR35, by definition, and we're talking about lifting something from s44 (with updated wording, which I still haven't bloody found in full ) and applying it to IR35.

I just have a sense that we're getting lost in details here. Details matter, of course, but the bigger picture has been rather clear since the expenses consultation and IR35 discussion documents were revealed; PSCs are within scope for all of this and the client will be gatekeeper, meaning that all PSCs could be profoundly (and equally) impacted, not only those working through a traditional employment agency. The agency legislation has a restricted focus (i.e. only "employment income" outside of "excluded services" is within scope), but the expenses changes and IR35 legislation cover all remaining income, and I can't see there being excluded services for IR35 (i.e. working offsite, working from home, or being a professional mod or rocker, which puts you outside the agency legislation).

[eek]

In terms of IR35, they are "discussing" rather than proposing (and that's a separate document).

According to Lisa's reading of s44(2), anyone through an employment agency (not sure whether this is an intermediary in general or an employment agency in the traditional sense?) will be presumed subject to SDC. I still think the main risk here is about the client being gatekeeper and unwilling to counter the presumption about the absence of SDC, whether direct or through an agency, so I'm not sure the employment agency (intermediary?) nuance is that important, but the practical implications are, in any case, quite clear, namely that it won't matter what the courts decide in status cases, because it won't get that far. Unlike the agency legislation, changes to expenses and IR35 will cast a wide net w/r to income within scope (i.e. expenses and dividends).

See my comment earlier on.

When this was first mentioned S44 explicitly excluded PSCs and PSCs were excluded from the expenses discussion document.
Now in the consultation S44 has reappeared with no document exclusing PSCs and PSCs are included in the expenses discussion.

It may be an oversight. It may not be...

[jamesbrown]

Thank you.

So the word 'and' is in there.

So they are proposing:

If you are through an intermediary and subject to sdc then you are in ir35

And

Anyone through an intermediary is by hmrc default, subject to sdc

In terms of IR35, they are "discussing" rather than proposing (and that's a separate document).

According to Lisa's reading of s44(2), anyone through an employment agency (not sure whether this is an intermediary in general or an employment agency in the traditional sense?) will be presumed subject to SDC. I still think the main risk here is about the client being gatekeeper and unwilling to counter the presumption about the absence of SDC, whether direct or through an agency, so I'm not sure the employment agency (intermediary?) nuance is that important, but the practical implications are, in any case, quite clear, namely that it won't matter what the courts decide in status cases, because it won't get that far. Unlike the agency legislation, changes to expenses and IR35 will cast a wide net w/r to income within scope (i.e. expenses and dividends).

[GB9]

Hello Just to clarify - from the consultation document:

"The Government is proposing to remove tax relief for ordinary commuting (in general, home to work travel and subsistence expenses) for workers who are:

Supplying personal services
Engaged through an employment intermediary (including umbrella companies, certain employment businesses and personal service companies) and
subject (or to the right of) supervision or direction or control of any person

Thank you.

So the word 'and' is in there.

So they are proposing:

If you are through an intermediary and subject to sdc then you are in ir35

And

Anyone through an intermediary is by hmrc default, subject to sdc

[GB9]

Yup. I think GB9 is confused about the scope creep that happened between discussion and consultation. Understandable, given the earlier assurances Expect the IR35 consultation to look completely different to the discussion document However, I'm pretty sure it will still include SDC and client engagement

Too right I'm confused.

I would just like HMRC to come out with a clear statement saying 'by default, all psc engaged through an intermediary will be deemed as under sdc' or not.

Yes, pigs will fly.

And how they could describe me as under SDC of anyone is beyond me.

[jamesbrown]

An update from the IPSE CEO on their survey - there's been c2,500 responses so far. I know I feel encouraged that so many people are engaged/incensed enough to make their views known. I'd hope that the fact that there are so many responses across the three surveys will, in itself, send a message about how problematic this is.

Edit: if you haven't already, please do so here

Except Gauke can't count. 1, 2, 3, 43,232, 5

[mudskipper]

An update from the IPSE CEO on their survey - there's been c2,500 responses so far. I know I feel encouraged that so many people are engaged/incensed enough to make their views known. I'd hope that the fact that there are so many responses across the three surveys will, in itself, send a message about how problematic this is.

Edit: if you haven't already, please do so here

[MicrosoftBob]

I love the terminology used in the article...
As to demand on a regional basis, London is seeing the biggest “demand spikes” for software engineering, in contrast to tech support and web development, which declined in the capital.

Oh but wait... isn't web development a subset/specialisation of software engineering

While I'm splitting hairs isn't this just another skills shortage scare story...

Don't worry bob consultancies will be charging to the rescue crying Tally Ho soon enough

[jamesbrown]

Hello Just to clarify - from the consultation document:

"The Government is proposing to remove tax relief for ordinary commuting (in general, home to work travel and subsistence expenses) for workers who are:

Supplying personal services
Engaged through an employment intermediary (including umbrella companies, certain employment businesses and personal service companies) and
subject (or to the right of) supervision or direction or control of any person

Yup. I think GB9 is confused about the scope creep that happened between discussion and consultation. Understandable, given the earlier assurances Expect the IR35 consultation to look completely different to the discussion document However, I'm pretty sure it will still include SDC and client engagement

[LisaContractorUmbrella]

I'm not knocking Lisa (hello Lisa) but her question referred to a piece of legislation aimed at umbrellas, not Ltd. I thank her for raising the point and the answer given by HMRC may well be exactly the same as for my question. However, Mudskipper stated the clause in question and rightly asked how that can be applicable to us. My question would have clarified that.

I also agree with Boredbloke that we need a good representative trade group similar to the BRC that would really come out and shout on our behalf. I raised this when we had the Lords committed but was told by several people that the PC would cover our position. Needless to say they were ignored and I'm glad I made my own contribution instead.

Hello Just to clarify - from the consultation document:

"The Government is proposing to remove tax relief for ordinary commuting (in general, home to work travel and subsistence expenses) for workers who are:

Supplying personal services
Engaged through an employment intermediary (including umbrella companies, certain employment businesses and personal service companies) and
subject (or to the right of) supervision or direction or control of any person

[eek]

If you think that bunch of self important, arrogant clowns with their own agenda who "officially" regarded IR35 as dead are representative of the contractor community then you need to lay off the funny tobacco.

They only claim a mandate because twenty? thirty? thousand contractors are "members" when in reality they are insurance customers.

Again, Why do you think I'm running the survey...

The question I was responding to was do we have a trade body to which the answer is that we do/did.

Granted it's got an agenda that isn't ours and has been as effective as a chocolate teapot ( they usually work once and pcg won the arctic case) but it was set up with the express purpose of representing us, its just forgotten it's purpose over the years.

[LisaContractorUmbrella]

Meanwhile, the 'skills shortages' show no sign of abating.

IT contractor pay 'exceeding what hirers can afford' :: Contractor UK



What timelines do you foresee for their implementation? 2016 for T&S and 2017 for IR35 changes, if any?

Yep that would make sense