Reply to: Outside / Inside / Umbrella / Perm or Bye!

[LondonManc]

Are you saying that because you don't like it, or do you have an argument why you think that?

IR35 has been created to prevent the situation when an employee on Friday becomes a contractor on Monday for the same company. This situation looks the same but other way around.

Changing your payment vehicle doesn't make you a permie. HTHBIDI.

[elsergiovolador]

No, it wouldn't. I'm not sure you're ever going to get this.

Are you saying that because you don't like it, or do you have an argument why you think that?

IR35 has been created to prevent the situation when an employee on Friday becomes a contractor on Monday for the same company. This situation looks the same but other way around.

[Paralytic]

So if someone was running a business that provided certain service and now becomes an employee of an umbrella and providing exactly the same service, wouldn't that prove the arrangement was to optimise tax and it was not a real business in the end?

No, it wouldn't. I'm not sure you're ever going to get this.

[LondonManc]

So if someone was running a business that provided certain service and now becomes an employee of an umbrella and providing exactly the same service, wouldn't that prove the arrangement was to optimise tax and it was not a real business in the end?

No. If the only way a specialist can provide his expertise to a company is via the payment vehicle of the client's choosing, why would that affect his working practices, statement of working or other contractual obligations that are not related to how the earned fees get to him?

[Lance]

Well, from April the client will potentially be liable for a penalty and tax if they got a contractor for an employee role, so many do preparations already, to remove themselves from any risks.

Which is completely irrelevant to the OP and the question.
Please. Just give it up now. Accept that you're wrong and walk away with some dignity.

[elsergiovolador]

It depends on WHY.

Well, from April the client will potentially be liable for a penalty and tax if they got a contractor for an employee role, so many do preparations already, to remove themselves from any risks.

[ladymuck]

So if someone was running a business that provided certain service and now becomes an employee of an umbrella and providing exactly the same service, wouldn't that prove the arrangement was to optimise tax and it was not a real business in the end?

It depends on WHY.

[elsergiovolador]

So if someone was running a business that provided certain service and now becomes an employee of an umbrella and providing exactly the same service, wouldn't that prove the arrangement was to optimise tax and it was not a real business in the end?

[LondonManc]

I think that is it really. Reassurance is very true as I am quite cautious and have been given good feedback from friends too outside of the forum.

I have enough proof that the right steps were taken as with all my contracts. Tbh the Umbrella rate isn't horrific and I have spoken to Lucy as recommended on here as well as a few others. You are right that the fee extraction vehicle is irrelevant. It is just a nervous jump at the same client between two methods of pay and as people are saying the risk is low.

HMRC want their pound of flesh to prove they are right; you'd be one of the few that they won't go near because EY have been involved and so has the CEST tool.
It's the outside to inside contractors that they'll be after.

[Hawkeye]

If they've used the CEST tool and EY (whose interest is probably to swap out contractors for consultants) and got an outside determination, your vehicle of fee extraction is irrelevant. Bottom line is that you can still be outside IR35 and use an umbrella. One guy told me about someone who was your typical boffin type - brain the size of a planet, no common sense. Probably knew how to split the atom but couldn't file a VAT return because it didn't interest him, i.e. very much on the spectrum. He couldn't be supervised or controlled in any way whatsoever but it was safer for his wellbeing to go via an umbrella. At the rate he was on, I suspect he wasn't bothered about paying proper tax because his take home was still better than most of our quoted rates!! Edge case but yours isn't edge, it's cut and dried. Umbrella, outside from client, fill your boots.

All you might need is reassurance that it will be still be outside via the umbrella.

I think that is it really. Reassurance is very true as I am quite cautious and have been given good feedback from friends too outside of the forum.

I have enough proof that the right steps were taken as with all my contracts. Tbh the Umbrella rate isn't horrific and I have spoken to Lucy as recommended on here as well as a few others. You are right that the fee extraction vehicle is irrelevant. It is just a nervous jump at the same client between two methods of pay and as people are saying the risk is low.

[LondonManc]

I didn't indicate that. The company has said that they will only take any temporary project resources via Umbrella post Sept.

The contract was 100% legit. The company did their due diligence in March with EY to ensure that they are on side with the law on Inside / Outside. I also did a pre-check before I signed up to anything and also did a full review of working practices. So I do not think there is any fowl play by the company. They are scared of future consequences and have decided as many to avoid the whole saga as far as I can see.

If they've used the CEST tool and EY (whose interest is probably to swap out contractors for consultants) and got an outside determination, your vehicle of fee extraction is irrelevant. Bottom line is that you can still be outside IR35 and use an umbrella. One guy told me about someone who was your typical boffin type - brain the size of a planet, no common sense. Probably knew how to split the atom but couldn't file a VAT return because it didn't interest him, i.e. very much on the spectrum. He couldn't be supervised or controlled in any way whatsoever but it was safer for his wellbeing to go via an umbrella. At the rate he was on, I suspect he wasn't bothered about paying proper tax because his take home was still better than most of our quoted rates!! Edge case but yours isn't edge, it's cut and dried. Umbrella, outside from client, fill your boots.

All you might need is reassurance that it will be still be outside via the umbrella.

[ladymuck]

Most of the stuff he posts comes from there kazoo or no kazoo.

Sort it out!

[Paralytic]

The client doesn't want to work on an outside basis, then what else does it mean?

It means you should go do some reading to understand the big difference between an inside determination and a client deciding to disengage with PSCs.

[northernladuk]

You're making a noise but it certainly isn't duck like unless you have a kazoo up your arse.

Most of the stuff he posts comes from there kazoo or no kazoo.

[ladymuck]

If it quacks like a duck...

You're making a noise but it certainly isn't duck like unless you have a kazoo up your arse.