Reply to: Hmrc ir35 tax yield figures - taking freelancers as mugs

[prozak]

hmmm.... 23 status enquiries last year, 12 the year before.

1.4 million freelancers.

Sounds like hector isn't that interested in IR35.

I've got the basic PGC membership... I'll keep it but it does seem like it is that necessary...

[v8gaz]

Nobody said there was ZERO risk (ok, perhaps Tarbie id, but you may have spotted him being castigated for this). We have pointed out that by taking certain precaustions that there will be MINIMAL risk, and with further products ZERO IMPACT.

Not sure how you do risk analysis, but in my book that's worth a punt.

[centurian]

Jesus, how do you ever manage to man up enough to cross a road?

Playing the macho card - that's so 80s / 90s

Again you're making incorrect assumptions (which doesn't surprise me). I'm all up for risk. I operate outside of IR35 quite comfortably.

But that doesn't mean that I don't understand the risks - and at least recognise where things can go wrong and then make an informed decision.

Simply convincing everyone that there is zero risk is reckless with other people's livelihoods and finances. Lay out the advantages and the disadvantages and let people make up their own minds.

[malvolio]

There are around 1.4 million small business in the IR35 firing line

There were 23 new IR35 cases in the last year. None as far as I know involved PCG members

What was that about risk assessment again?

And the whole point of PCG Plus cover is that your intial aspect inquiry never gets turned nito an IR35 case in the first place. Even the dimmest Hector won't start a case he knows he's not going to win. Chuck in the other benefiits of Plus cover like Jury Service cover and Agency Default protection for your £220 a year and its a total no-brain decision AFAIC. Although you can get the investigation protection elsewhere, of course, but to my mind the economics just don't add up.

[dx4100]

Jesus, how do you ever manage to man up enough to cross a road?

When I was weighing up the pros and cons of surrendering my hard earned money to the silliness and unfairness of IR35 I came to realisation that I could have my cake and eat it.

If you are risk adverse, which I appreciate as I also have little interest in taking risks which could result in me losing my home specially with a young one, you could always do the following. Get the PCG coverage, pay out for the Tax loss insurance, pay out for the contract reviews, and then take home pretty much what you would get under IR35 and leave the rest sat in your business account. Then release it when you close the business and or the six years is up (isn't it in reality 2 years for various reasons once the company has been closed ?)

If hector wants the money then they can fight you for it (or in other words the lovely legal people courtesy of the PCG) while you always have the piece of mind that you can cover the tax losses with you own cash if every goes to tulip.

Am I missing something or is that not the best approach for the risk adverse ? Much more sense than the Umbrella route.

[v8gaz]

I never said anywhere in any of my posts - that it is any easier or harder - just merely pointing out that some people are quite risk adverse to the point that they just want to sleep well at night. If you're not one of those people then congratulations - but not everyone is like you.

Also insurance is not an absolute guarantee of safety. It covers you for investigations started within the next 1 year - you need cover for the next 6 years.

If HMRC start getting really nasty and QDOS/PCG (or anyone else) lose multiple cases with shed-loads of 6 figure payouts - then make no mistake, the underwriters will honour their current commitments, but withdraw from the marketplace. The following year, you will not be able to get your insurance renewed, which will be exactly at the point that the HMRC wolves are more likely come knocking.

Is this scenario likely, no, not at all - quite the opposite in fact. But don't think that insurance provides a 100% cast iron guarantee.

Jesus, how do you ever manage to man up enough to cross a road?

[centurian]

Given that there are now considerably fewer investigations going on, I'm staggered that you think anything has got harder - quite the reverse!

I never said anywhere in any of my posts - that it is any easier or harder - just merely pointing out that some people are quite risk adverse to the point that they just want to sleep well at night. If you're not one of those people then congratulations - but not everyone is like you.

Also insurance is not an absolute guarantee of safety. It covers you for investigations started within the next 1 year - you need cover for the next 6 years.

If HMRC start getting really nasty and QDOS/PCG (or anyone else) lose multiple cases with shed-loads of 6 figure payouts - then make no mistake, the underwriters will honour their current commitments, but withdraw from the marketplace. The following year, you will not be able to get your insurance renewed, which will be exactly at the point that the HMRC wolves are more likely come knocking.

Is this scenario likely, no, not at all - quite the opposite in fact. But don't think that insurance provides a 100% cast iron guarantee.

[v8gaz]

Insurance isn't guaranteed to be offered. I suspect some will stretch the truth about their working practices in order to get accepted (which effectively means they don't have insurance)

And insurance isn't guaranteed to be around for years 2-6.

It offers for a slightly better night's sleep, but for the risk adverse - not much.

What the hella re you talking about? As Mal says, anyone gets insured under PCG, and with figures in the order of 1450 wins to 6 losses, where the losss were in large amount down to the victim trying to represent themselves agaisnt all advice, then I would say that is pretty re-assuring.

Given that there are now considerably fewer investigations going on, I'm staggered that you think anything has got harder - quite the reverse!

Oh, and yes, Tarbie is a dolt.

[malvolio]

Insurance isn't guaranteed to be offered. I suspect some will stretch the truth about their working practices in order to get accepted (which effectively means they don't have insurance)

And insurance isn't guaranteed to be around for years 2-6.

It offers for a slightly better night's sleep, but for the risk adverse - not much.

PCG insurance is unconditional provided you are not already under investigation when you join.

Simple enough, isn't it?

[centurian]

So you buy the insurance, join PCG and get on with running a business.

Insurance isn't guaranteed to be offered. I suspect some will stretch the truth about their working practices in order to get accepted (which effectively means they don't have insurance)

And insurance isn't guaranteed to be around for years 2-6.

It offers for a slightly better night's sleep, but for the risk adverse - not much.

[malvolio]

Right, I see! This is a disguised 'Join the PCG, you dolt' thread - it all becomes clear!

Bored of your own forum lads or are you on holiday?

No, Tarbie is actually a dolt. But we love him.

[cojak]

Right, I see! This is a disguised 'Join the PCG, you dolt' thread - it all becomes clear!

Bored of your own forum lads or are you on holiday?

[v8gaz]

It may sound odd to a hardened contractor but a lot of people can't live with the fear of a 6 year retrospective IR35 inquiry which would mean that they could be landed with a big tax bill which would make them lose their house. So they prefer to take the safe option and declare their income as IR35 caught and live a quiet life.

So you buy the insurance, join PCG and get on with running a business. I'm finding it difficult to see why anyone would co contracting long term via an umbrella - all of the risks, none of the benefits. Why not just go permie and get all the additional benefits and (limited) security that gives you?

[GeekyGrandad]

Tax insurance still required

Dear Tarbie,
What? You dolt!

The tax insurance covers all tax investigations. A bog standard compliance check, and there are a lot more of them happening per year than IR35, handled by your accountant will cost you nearly 10 times the PCG insurance cost (cirrca £2000).

[centurian]

A low chance of investigation is of little comfort if you are unfortunate enough to be nailed.

It's little consolation to those affected by BN66 that many other schemes have not been investigated - in fact it seems to piss them off even more, that they are being singled out.

Hanging on for 6 years to find out whether you get to keep the cash is too long for some.