Originally posted by DrStrange
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Previously on "Blanket Assessments - tax risk back to Client?"
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So, in reality, there's no obligation at all for ClientCo to take any reasonable care if they deem inside?
But if they deem outside with no reasonable care they'll take all the tax risk?
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Originally posted by DrStrange View PostHow is the risk transferred back?
What happens if an agency for example ignored the client and still settled gross, on the basis the client didn't assess properly? If HMRC investigate and I lose, and if I can prove the client didn't take reasonable care but the agent and I did (albeit incorrectly in this case) are we saying the client is liable?
I get that that sounds ridiculous but if it's not true, how can the client have any risk on the reasonable care side?
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Originally posted by Peoplesoft bloke View PostThe “risk” that transfers back to the client is that they will have to pay employer’s NI. HMRC are unlikely to go looking for cases where an organisation wrongly deemed a contractor inside IR35, no matter how shoddy the assessment- they will only be looking for any chance to grab tax from an incorrect (or inadequate) outside assessment. Since caselaw shows HMRC have no actual clue and persue obviously hopeless cases, employers have decided it’s not worth the risk, so are not blanket assessing - they aren’t doing any assessments.
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What happens if an agency for example ignored the client and still settled gross, on the basis the client didn't assess properly? If HMRC investigate and I lose, and if I can prove the client didn't take reasonable care but the agent and I did (albeit incorrectly in this case) are we saying the client is liable?
I get that that sounds ridiculous but if it's not true, how can the client have any risk on the reasonable care side?
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Originally posted by GhostofTarbera View PostThe big private sector clients are not blanketing everyone inside, they have decided not to engage limited company contractors, only people via umbrellas or PAYE agency
That’s how - thus avoiding any IR35 guff
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The “risk” that transfers back to the client is that they will have to pay employer’s NI. HMRC are unlikely to go looking for cases where an organisation wrongly deemed a contractor inside IR35, no matter how shoddy the assessment- they will only be looking for any chance to grab tax from an incorrect (or inadequate) outside assessment. Since caselaw shows HMRC have no actual clue and persue obviously hopeless cases, employers have decided it’s not worth the risk, so are not blanket assessing - they aren’t doing any assessments.
Sent from my iPhone using Contractor UK Forum
Leave a comment:
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The big private sector clients are not blanketing everyone inside, they have decided not to engage limited company contractors, only people via umbrellas or PAYE agency
That’s how - thus avoiding any IR35 guff
Sent from my iPhone using Contractor UK Forum
Leave a comment:
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Blanket Assessments - tax risk back to Client?
If the client makes a blanket determination then:
"They do not constitute ‘reasonable care’ – They breach a requirement of the legislation section 61T(6)(c), resulting in the tax risk passing back up to the hirer from the agency (‘fee-payer’)."
I assume this means that say the client deems inside but the agent disagrees and settles my invoices gross. If I'm later investigated and I lose, then it's the client that's liable. But I can't see that clearly in the rules (which admittedly I struggle to follow!)
Can anyone explain how the risk transfers back to the client if they don't take reasonable care?
(P.s. I know no agent will do this - just trying to understand the rules, to maybe scare the client a little...)Last edited by Contractor UK; 28 June 2020, 11:22.Tags: None
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