Reply to: Umbrellas

[Denny]

I've thought it for a while but now I'm sure, you are a tax inspector in disguise!

That I'm not.

I'm a traffic warden, didn't you know? By the way, you're tax disc is nearly expired.

[freshblue]

I've thought it for a while but now I'm sure, you are a tax inspector in disguise!

10 years+ may see a different employment model landscape but I think the varieties we currently have will remain for some time yet.

[boredsenseless]

Let's face it, most of our work is carried out on site and equipment provided and hardly any of us have rights of substitution. It makes much more sense for us to be opted in, taxed at source by the employment businesses with no employers NI deducted only employee NI.
...
It's a no brainer really.

I've thought it for a while but now I'm sure, you are a tax inspector in disguise!

[Denny]

There have been rumours that Hector and Co are planning on going after composites / umbrellas for a long while, including on these boards. It's one of the reasons I went Ltd instead of Brolly when I started up.

Very wise. Personally, I doubt that any brollie will be considered legit' if what I was told yesterday is anything to go by. The IR are not keen on Directors in kind acting on our (the agency's) behalf only real ones or else they want contractors to be hired directly by the employment businesses with PAYE and NI deducted at source and no employers NI to pay. They don't find the currently brollie schemes to be either fair on themselves (too many dispensations allowed) nor do they consider that employers NI should be deducted if we are not really Directors of our own service managed companies.

I expect that, in time, opting in will be mandatory for all contractors who use employment businesses - for our own protection, in the interests of fairness and because the Revenue will have a much easier time concluding we are all IR35 compliant with tax deducted on all our income nor just some of it.

Let's face it, most of our work is carried out on site and equipment provided and hardly any of us have rights of substitution. It makes much more sense for us to be opted in, taxed at source by the employment businesses with no employers NI deducted only employee NI. At the moment, contractors are merely classified and treated as employees with no rights if we're forced into opting out. Personally, I would welcome such a move if I still had the option of being a Director of my own company if I felt opting out was appropriate and was not IR35 compliant should the working conditions dictate that such status was justified. Clear lines of division are what is needed (opt in = IR35 compliance = on site control - employment business administration or else opt out = IR35 exemption = autonomous working conditions. What we have at the moment is a muddled status that seems to favour employment businesses and their clients and just exposes us to unnecessary risks.

It's a no brainer really.

[Ivor1]

I use an BIG umberalla and the IR started asking a few questions mid last year, but since then it has all gone quiet. I use a composite scheme but I dont blag the expenses and to be honest I net around 68%. I chose this route as at first I didnt know if I would contract long, however nearly 2 years latter Im still contracting and still with them. I will move to my own ltd but cant at moment as buying a house and need to be with composite to get mortgage.

I know what my liability is if the IR do me, but I have two back up plans, 1. The IR35 insurance I got and 2. I have saved the money I would owe them if they come after me and the IR35 insurance doesnt pay up. To be honest if they do come after me I hope its this year as my IR35 insurance expires for one contact I had come Jan 07, other contract Im on now insurance expires Jan 08.

Each to there own whether they go composite or limited. The bottom line is the IR are a bunch of ar*e fuc*ing c*nts, who will stiff anyone they can to fill the black whole in taxes. It doesnt matter what we do in the IR its always wrong, its an ever moving target. People know the risks and its a chance people take.

UK Government wants a flexible workforce yet the place these ******* stupied tax laws on us. I never really concerned myself with government policy until I started contracting and became away of IR35. I never claimed a penny off the state, never claimed unemployment benefit, funded my OWN way through university and now I made to feel like a criminal. This has led to me being massively recentful for all the people comming into this country spounging off us as well as all are own born and bred scrougers.


It f*cks me off so much.

[DaveB]

There have been rumours that Hector and Co are planning on going after composites / umbrellas for a long while, including on these boards. It's one of the reasons I went Ltd instead of Brolly when I started up.

[malvolio]

But playing the other side for a mo, it is clear that using a composite is a deliberate ploy to avoid paying tax since you have no intention of ever running a standalone company (so why should you get the fiscal benefits?) and have nothing in common with the other members of the composite, unlike a Partnership for example. Umbrellas will either be disguised composites (so same point applies) or you are a fully employed and fully taxed member of their staff just like an agency temp and IR35 doesn't apply anyway.

Personally I'm happy for them to chase composites, if it means the small companies come off the radar for a while.

[freshblue]

All forms of "trading" have a POTENTIAL for being interpreted as avoidance by all the interested parties. Taxation is only going one way at the moment and the HMRC will have a list of priorities to support that.

Individually you make a choice based on facts and how you assess risk.

[ChimpMaster]

So what are you saying --

run for the hills?!!!

[Denny]

The missing word is composite.... Article in Accountancy Age today... comments from the HMRC apparently...GMB whinging about them too!

At first he told me he meant composite too. However, I asked him about other brollies and he said that he had missused the word composite to embrace all other brollies as well.

I did do my homework you know!!

[malvolio]

{I-told-you-so helmie}

[freshblue]

The missing word is composite.... Article in Accountancy Age today... comments from the HMRC apparently...GMB whinging about them too!

[Denny]

I know all umbrellas are being scrutinised but doubt very much the honest ones will be effected as they ensure correct tax is paid and I can't see that being put at risk. I guess they have to investigate as many as possible to get a true picture. I'm sure that all the dodgy umbrellas will be at severe risk - I think many people clients, agents, and contractors will probably have grassed on them for one reason or another as we hear so many disgruntled contractors on this board on that issue.

It doesn't surprise me that this guy knew very little - a lot of decisions are made by people in power without any knowledge of what they are legislating for.

This man was a senior bod involved in the unit itself, not a customer service type wheel cog paid to take calls from IT professionals and other related service providers.

The whole ethos of umbrella company use is what they are reconsidering, not just whether some are operating properly or not.

[Lucifer Box]

Like a bowling ball Lucifer

A man after my own heart!

[DodgyAgent]

You're sharp today, Dodgy.

Like a bowling ball Lucifer