Reply to: Letter to my MP, and the response.....

[SueEllen]

I didn't answer the last part of your origin quote "Why as an MP I would see IR35 as complex".

It's a case of explaining it to the MP in terms they understand. If they actually worked before coming an MP as a lawyer or similar rather than a political researcher then it's easier.

So when I wrote to my MP about T&S I knew his business interests and appealed to them.

[SueEllen]

What was not clear from that statistic is whether they stopped practising for ever or were just taking a break after 6+ years of training. Also one chunk was those still being doctors but now as contractors

A little while back I was at BNP Paribas and within spitting distance of my desk there were two people who had been trained as doctors. I also worked for SmithKline in pharmaceuticals, and there are quite a lot of doctors in that line of business. I think it is a spurious line of argument. I was trained as a physicist but I would wager a lot less than 50% of my colleagues went into physics professionally.

Applied medical subjects are seen as a vocation not just a job.

So with doctors and those in practical medical subjects e.g. nurses, dentists, physios it's expected that over 70% use the qualifications they were trained for. (The Department of Health is suppose to use that in their calculation of how many places to fund.)

While those of us who have done physics, chemistry, biochemistry etc it is presumed the other way round. That after a first degree and even a Masters in the area you are more likely to become an accountant than a researcher.

I can't remember the organisation who collated the figures but all the Royal Colleges and the BMA are worried. It would mean their cartel like system of keeping foreign doctors out would have to end and we would have to recruit doctors from countries who train too many. Unfortunately we would actually end up with doctors staying long term from countries that don't have enough.

[Cirrus]

Yes it is true what IR35 was initially brought in to cover.
50% of junior doctors stop practising within 2 years out of university.

What was not clear from that statistic is whether they stopped practising for ever or were just taking a break after 6+ years of training. Also one chunk was those still being doctors but now as contractors

A little while back I was at BNP Paribas and within spitting distance of my desk there were two people who had been trained as doctors. I also worked for SmithKline in pharmaceuticals, and there are quite a lot of doctors in that line of business. I think it is a spurious line of argument. I was trained as a physicist but I would wager a lot less than 50% of my colleagues went into physics professionally.

[SueEllen]

Yes it is true what IR35 was initially brought in to cover.

What is more amusing a large majority of organisations doing it at the time where in the public sector. I actually know contractors who fell into this. Though there was a few weeks/months between their engagement. Decent companies are now too afraid of legal repercussions to try this as it is a fake redundancy situation.

50% of junior doctors stop practising within 2 years out of university. In other words they don't emigrate they just find another job in the UK with their degree. The fact their degrees are the most expensive for the tax payer to subsidise means we are wasting loads of money.

[Cirrus]

Once Labour came to power in the late 90s they began talking of Friday to Monday employees, those who resigned from a company on a Friday and were engaged by the same company on Monday though now working via their own limited company. The government introduced legislation known as IR35 which they said was intended to counter <this>

Is that true? I'm not saying it wasn't but I didn't know IR35 was soley concerned with the Friday-to-Monday phenomenon.

The legislation that is under consultation ... any pension contributions that the limited company wishes to make to a pension scheme would be after the deduction of National Insurance

Is that true? Currently IR35 taxes you like an employee ie you only pay tax after pension deductions

with none of the benefits of employment .

Surely the vast majority of 'benefits of employment' are arranged by the employer and funded by the employer. I'm not clear why the Revenue is expected to give tax rebates connected with these contractual matters. This is indeed the crux of Osborne's argument: it's up to you to earn enough to pay your taxes and not expect state subsidies.

Faced with such a change most freelance IT staff would either leave the industry or become permanent,

This is like most doctors will leave the NHS and go abroad. Figures latterly have shown next to no increase in doctors emigrating despite the fact it is a million times easier for them than us.

We need simplification not further complexity.

As a local MP I would struggle to see why IR35 is complex.

As a local MP I would struggle to see why any of this is a bad situation. If we are going to write letters or otherwise make a fuss, there has got to be some clear credible argument as to why this has an adverse effect on the country, business or the general population.

[MPwannadecentincome]

I have only just seen this and I don't get point being made at all around the figures. Can you explain the relevance of NI being lower in one or tax lower in the other when all Daily Mail reader cares about is total deductions?

The total deductions are significantly lower under non IR35 by your own figures by approx £10,000 without taking into account taxes paid on dividends which would reduce the gap especially after April 2016.

BTW I don't get how you calculated the figures for "IR35" did you take 5% allowance for expenses into account? Also I don't get how you can say under IR35 the salary is just £10,000?

If the limited company invoices £100,000 in a year

IR35 non IR35
Salary £10,000 £10,000
Employer NI £ 10,275 £ 0
Employee NI £ 4,959 £ 232
Corporation Tax £ 0 £18,000
Income Tax £23,185 £10,713

Total Tax £23,185 £28,713
Total NI £15,234 £ 232

[Fandango]

Well just to add to the collection of BS responses from Gauke here's mine

[NotAllThere]

..., not the least being that 90%+ of the voting population are too disuninterested or stupid to make a rational decision.

Disinterest is impartial interest, not lack of interest.

[SantaClaus]

Good luck if you think we live in a democracy. Even better luck if you think you'll get a sensible reply from David Gauke.

That letter from Gauke more or less translates to "I intend to shaft all contractors".

[BrilloPad]

Were you really expecting anything different?

[NotAllThere]

Could you post what you sent to your mp?

I have a disinterest in the matter since I've no intention in working in the UK ever again.

But yet NAT say's being in one long contract for oh, say 9 years, with the same client doesnt make you part and parcel of the client's organisation and, its 'how you work that counts.'

Sadly, I think most of what NATS can be taken with a pinch of salt with regard to UK circumstances.

I may live and work in the UK, but its quite possible in this day and age to keep up with what's going on in blighty and to think analytically and critically about it.

Politicians are simple souls. They're also kept busy. If you want to communicate with them, keep your sentences short and to the point. Perhaps you'd care how my opinion on this is invalidated by my work and life situation.

Anyway - no more please stay on topic.

[TykeMerc]

you're just not that interesting

Coincidentally, that's pretty much what your MP appears to have said to you.

[80sContractor]

no, still here

Ah, the old "wanders off whistling nonchalantly" technique, not seen that employed in a few weeks.

you're just not that interesting

[TykeMerc]

I'm not wound up, rather chilled actually, bit of a quiet afternoon that you are helping drift by, time for lunch actually.

Ah, the old "wanders off whistling nonchalantly" technique, not seen that employed in a few weeks.

[80sContractor]

thanks...

No your opinion means the square root of sod all to your MP and even less to the Treasury and HMRC.

I'm not shouting at you, I'm pointing out that you are getting wound up over something completely predictable as if it was something new.
Here's news for you, unless you have a lot of influence and what you want fits their existing agenda (or pushes a public outrage button like a toddlers corpse on a beach) then you get the metaphorical equivalent of "Yes dear". It has always been this way and it's never going to change while the current "democratic" system exists unchanged here.
If you and I and every registered elector in this country got to vote on every issue by discrete vote then it would be different, but that's not practical for countless reasons, not the least being that 90%+ of the voting population are too disinterested or stupid to make a rational decision.

I'm not wound up, rather chilled actually, bit of a quiet afternoon that you are helping drift by, time for lunch actually.