Reply to: P35 Q6 End of year forms and accountants

[css_jay99]

I chose No/No last year.

maybe I should choose Yes/No this year and get it over and done with

css_jay99

[kaiser78]

My accountant selected 'NO' to this question.
And my previous accountant sent direct to HMRC to not sure what they ticked.

[Sockpuppet]

I've got a feeling the questions are just to see who is worth investigating... I wouldn't be suprised if they've got a program which does something like this....

Well of course they are.

Bear in mind that most small Ltd companies will have to answer "YES" to question 6a not just contractors.

The next question "did you operate intermediaries legislation" I've taken to mean "Are you caught by IR35".

[krytonsheep]

I've got a feeling the questions are just to see who is worth investigating... I wouldn't be suprised if they've got a program which does something like this....

if P35 Question 6 = YES , NO
{
        if (PAYE < 10k ) // if the company contributed some PAYE  then ignore them
        {
               if (VAT paid in the last 12 months > 20k)        // make sure they've been earning a decent amount
               {
                          // check for continued employment over 3 years           
                          
                          if (VAT receipts are roughly the same amount each quarter for last 36 months)
                          {
                                    AddToIR35 investigation list.
                          }
               }
        }
}

[Sockpuppet]

I know this is an old tread,

how are people answering these two questions?

css_jay99

Yes / No if you're outside IR35 and Yes / Yes if you're inside.

In reality it doesn't make 2 hoots of a difference as to who HMRC investigate. They've tidied up the "service company" question which is pretty clear cut now so most people here will answer yes.

Whether you answer Yes/No doesn't matter as if they see £100k of billing and £5k of PAYE payments regardless of the questions answered you're a target for investigation. I could have answered Yes / Yes this year as I did £200 worth of work that was arguably inside IR35 but the instructions were not clear so I went with the usual No.

[css_jay99]

I know this is an old tread,

how are people answering these two questions?


css_jay99

[Jog On]

The PCG advice is not definitive (if you think about it, they can't really give definitive advice since the actual question is unclear) but it is the advice given by their own professional advisers.

There are divergent opinions on the first answer but from what I understand answering Yes or No to Q1 makes little practical difference anyway; even if it is a crude attempt to get a list of all IR35 candidates, that data is already available elsewhere and they are simply looking to save time and effort collating it. What is clear IMHO is that you should answer No to Q2 unless you are convinced you are inside IR35.

That's what this looks like to me - is this the first time these questions have appeared on a P35? I wouldn't know as it's the first time for me.

[Chugnut]

I'm ticking "NO", "NO" as all the people who ticked "YES", "NO" will be investigated first.

Why would that make a difference?

If you're worried about an investigation because you're not sure of your status or you've done something wrong, the later it comes the more your liability could be. Sooner rather than later may not be a bad thing.

[richy]

I'm ticking "NO", "NO" as all the people who ticked "YES", "NO" will be investigated first.

seems like the best idea.

Can anyone explain the rationale for saying "Yes we are a Service Company" ? If we work from our home office, work off-site with clients on their site, deliver software and integrate software into a clients platform I don't see my company as any different from a plumber or builder or architect.

the question is flawed, as everyone coould be interpreted as a service company, if they define it right.

[Lockhouse]

I'm ticking "NO", "NO" as all the people who ticked "YES", "NO" will be investigated first.

[Chugnut]

There are divergent opinions on the first answer but from what I understand answering Yes or No to Q1 makes little practical difference anyway; even if it is a crude attempt to get a list of all IR35 candidates, that data is already available elsewhere and they are simply looking to save time and effort collating it. What is clear IMHO is that you should answer No to Q2 unless you are convinced you are inside IR35.

Agreed Mal, but I think answering No to the first question on grounds of lack of definition would be a difficult point to argue / convince HMRC in the result of an inspection. Their current mindset seems to be that they've had enough of 100% PAYE avoidance in any form and would argue they and we know exactly who they are targetting. To tick no on a technicality will just wind them up.

The second question should be a no if you think you're outside and leave the burden of proof on them. As long as you've exercised good IBOYOA principles and have the professional respresentation of PCG, QDOS, etc. to cement that opinion, you've done all you can IMO.

Anyone else fed up with obstacle after obstacle and just want to get on with running their company?

[xoggoth]

Yeeeeeh. Being retired from contracting I shall enjoy ticking no and putting 0.00 in every box.

[malvolio]

The PCG advice is not definitive (if you think about it, they can't really give definitive advice since the actual question is unclear) but it is the advice given by their own professional advisers.

There are divergent opinions on the first answer but from what I understand answering Yes or No to Q1 makes little practical difference anyway; even if it is a crude attempt to get a list of all IR35 candidates, that data is already available elsewhere and they are simply looking to save time and effort collating it. What is clear IMHO is that you should answer No to Q2 unless you are convinced you are inside IR35.

[Chugnut]

Linkys?


Seems odd to answer "yes" then "no". Why would you not apply the services company legislation if you are in fact a services company?

Doesn't "apply it" mean that you think you are inside it? If you think you're a services company but your working practices place you outside IR35 you tick the No I guess.

However, maybe not. There's an argument for Yes for the second question. I've applied it and decided it doesn't apply to me, for instance. It is so open to interpretation!

Interestingly, QDOS advise the Yes/No response but you won't invalidate your insurance if you tick No to the "Are you a Service Company" question according to a member of their staff who posted on Shout99.

[Ruprect]

I did mine yesterday - and put NO.

Blimey, that's efficient.