FRS Paranoia

[Nixon Williams]

To use a false SIC code would not be recommended, although these are mainly used for statistical purposes to monitor the UK economy etc. Most contractors use the VAT Flat Rate scheme, so using a false business description could lead to an issue with the VAT office for underpaying VAT.

The P35 has for several years asked a question about whether the IR35 rules have applied to any of your income.

Provided that you do not get stupid about what you do then even if HMRC do have a look you should have nothing to fear. The contractors who take risks need to be prepared that if HMRC take a look then they may get caught.

There does not appear to be any evidence that HMRC have used this information so far to target any sector, but then things can change!

There is no need to hide away, just be sensible.

Alan

[nullfork]

I formed my Ltd via SJD, and even though I stated my sector, my SIC is 03 (None Supplied) at Companies House.

It looks as though (some) accountants / company formation companies are pro-actively filtering out specific SICs?

Either way, I still think the FRS is going to be used as part of Hector's "Ranking/Weighting" mechanism...

Would like to hear some other opinions about that. To me it seems like such common sense that I'd put money on it (so to speak!).

Stuart

[Chugnut]

Does not being registered as an IT consultancy really make a difference to IR35?

I'd like to hear what SJD/Nixon have to say on these Qs too.

I think you can assume that this information would be used to target companies to investigate. It's an obvious pointer.

Unfortunately, even if SJD/Nixon say "No, it categorically isn't used and I have proof" so what? They might start using it next week.

Piece of mind? Exit, stage left.

[realityhack]

I'm not sure you're right there - setting up an SIC unrelated to your actual business practice could be seen as being deliberately misleading - evidence of deception even. I'm not a solicitor / expert in these matters, but I wouldn't take that chance.

I'm not registered as an IT co - but then I'm not a programmer/coder, I'm a designer. The fact that all my design work is multimedia related means I have to use computers as a tool to do the job, but I registered as design-related activities / art & design. I often create graphics and storyboards, prototypes etc - and do a lot of illustration/artwork - so I can back that up if required.

Does not being registered as an IT consultancy really make a difference to IR35?

I'd like to hear what SJD/Nixon have to say on these Qs too.

[oracleslave]

If your Ltd Co is registered under 'IT Consultancy' and whatever tax code is the relevant one, your chances of being investigated are infinitely more than being under a different one, eg 'General something or other'.

Fact or opinion?

[Ruprect]

There is no law against setting up a company under category 'Financial Services' or 'Telecom Software' or even 'Imports' if you like - a Ltd. Co. is just a vehicle for your transactions, it doesn't have to be tailor-made to one thing. Check with your accountant if you don't believe me.

SJD/other accountants care to comment?

[Dow Jones]

Anything but

There is no law against setting up a company under category 'Financial Services' or 'Telecom Software' or even 'Imports' if you like - a Ltd. Co. is just a vehicle for your transactions, it doesn't have to be tailor-made to one thing. Check with your accountant if you don't believe me.

[FiveTimes]

If your Ltd Co is registered under 'IT Consultancy' and whatever tax code is the relevant one, your chances of being investigated are infinitely more than being under a different one, eg 'General something or other'.

So what do you class your business as then if its not IT Consultancy ?

[Archangel]

Hi all,

Am I just being paranoid (all too easy these days), or is the FRS a key indicator that HMRC would use when choosing which companies to (employer compliance / IR35 / etc.) review?

i.e. Let's filter out all company registrations who are FRS registered and business sector is "IT consultancy"...

;-) ?

Stuart

There is nothing better than being investigated and being found outside IR35! Much better than looking over your shoulder for years.

[Dow Jones]

Indeed

Correct - not sure about FRS

[nullfork]

If your Ltd Co is registered under 'IT Consultancy' and whatever tax code is the relevant one, your chances of being investigated are infinitely more than being under a different one, eg 'General something or other'.

I take it you're referring to the SIC code and not necessarily FRS then?

[Dow Jones]

Come and get me

If your Ltd Co is registered under 'IT Consultancy' and whatever tax code is the relevant one, your chances of being investigated are infinitely more than being under a different one, eg 'General something or other'.

[SueEllen]

Nope.

[nullfork]

Hi all,

Am I just being paranoid (all too easy these days), or is the FRS a key indicator that HMRC would use when choosing which companies to (employer compliance / IR35 / etc.) review?

i.e. Let's filter out all company registrations who are FRS registered and business sector is "IT consultancy"...

;-) ?

Stuart