Creating a new company and putting the old one to bed

[SueEllen]

An accountant friend of my wife said something similar and was warning me I should move on! I laughed in her face!

Since I know a few accountancy contractors who actually work like IT Contractors I find it amusing.

Though I do like asking accountants what a "Personal Service Company" is and how it differs from a normal limited company.

[jamesbrown]

An accountant friend of my wife said something similar and was warning me I should move on! I laughed in her face!

The misinformation is rife. I was reading one of the many articles (in one of the daily broadsheets) following the recent public sector remuneration debacle, and they had some tax lawyer spouting about how any contractor with a single client was "bang to rights" w/r to the intermediaries legislation. My sister is a qualified accountant and she was supposedly taught something along the same lines. That's why it's in our best interests to know the details and get a specialist contractor accountant and the appropriate memberships.

[MickeyP]

I was surprised to hear other contractors who i've spoken to recently, saying things like this. They assume that once you work for a client for 2+ years, you're IR35 caught. I tried to explain that they were getting mixed up with the 24 month expenses rule, about D&C, MOO, RoS too.

It kinda fell on deaf ears though as i heard later on that they aren't going to accept any renewals because they don't want to be there for 2+ years and be IR35 caught

An accountant friend of my wife said something similar and was warning me I should move on! I laughed in her face!

[kingcook]

Lets assume someone has been contracting at a client for just short of 2 years with a limited company going via an agency. IR35 looms.

I was surprised to hear other contractors who i've spoken to recently, saying things like this. They assume that once you work for a client for 2+ years, you're IR35 caught. I tried to explain that they were getting mixed up with the 24 month expenses rule, about D&C, MOO, RoS too.

It kinda fell on deaf ears though as i heard later on that they aren't going to accept any renewals because they don't want to be there for 2+ years and be IR35 caught

[Mr.Whippy]

IR35 doesn't loom - you're either inside or outside from day one.

Generally this is right, but has now been proven to not always be the case... such as JLJ Services and the split IR35 case....

[northernladuk]

Thanks, I think that is the bit of info that makes the difference.

I am not an expert in contracting legalities, I like a simple life. Work, get paid, spend it, keep under the radar.

It is no wonder we have IR35 hanging over us. You are a contractor and a business,. You have a legal responsibility to run your company properly and a responsibility to conduct yourself as a professional business. Only permies turn up for an easy life.

24 month isn't a legality, it is a very simple piece of legislation (ok it isn't but just knowing the difference between IR35 and 24 month rule is!)

[JoJoGabor]

I know a few people who shutdown companies every 2 years to ward off the risk of investigation and know one other person who started getting investigated for IR35, but because he had shutdown his company he said they told him it was too much effort to pursue him. However, this guy is full of sh!t

My belief is it doesn't make any difference as they come after the indivudual, not the company director.

Anybody else come across any real examples of this?

[stek]

Thanks, I think that is the bit of info that makes the difference.

I am not an expert in contracting legalities, I like a simple life. Work, get paid, spend it, keep under the radar.

Remember too that the rule kicks in a soon as you know you will hit 24 months.

[coronasan]

It is location you work at regardless who for.

Thanks, I think that is the bit of info that makes the difference.

I am not an expert in contracting legalities, I like a simple life. Work, get paid, spend it, keep under the radar.

[SueEllen]

WNLUKS

You are better off negotiating with the agency for some extra to cover your increased costs.

If that doesn't work then you have to absorb the costs or go and get another contract somewhere completely different.

[northernladuk]

Haven't you been contracting for 5 years??

Your first post announcing your first contract was on 21st Mar 2007. Have you shut down a company since?

And if it is 24 month rule the quick answer is no it does not go away. It is location you work at regardless who for.

if it is 24 month then also look at the navigation panel to the right.

[cojak]

You're confusing IR35 with the 24-month expenses ruling, and not understanding either of them.

Take a look at the IR35 information on the Navigation panel.

[northernladuk]

What on earth does IR35 looms mean??

You are at risk of being investigated and losing or you have another contract coming that is within IR35?

[stek]

IR35 doesn't loom - you're either inside or outside from day one.

[coronasan]

Apologies if this has been covered to death before.

Lets assume someone has been contracting at a client for just short of 2 years with a limited company going via an agency. IR35 looms. Could the person start a new company with a new company director and company secretary and invoice via the new company to the agency? Does this negate the IR35 issue?

The new company may even be an international company with directors in Ireland and England.