New Contract (Indemnity Clause)

[cojak]

I have been looking at Tax Liability Cover but one thing that struck me was the fact that I am contracting but would accept a staff roll if a good one came along. This would mean the insurance would obviously end but how long after can HMRC still investigate your tax affairs for (5 years?). It just a general point I wondered if people considered it?

Yes we have considered it.

I will be a member of the PCG for 6 years after I've stopped contracting.

[malvolio]

I have been looking at Tax Liability Cover but one thing that struck me was the fact that I am contracting but would accept a staff roll if a good one came along. This would mean the insurance would obviously end but how long after can HMRC still investigate your tax affairs for (5 years?). It just a general point I wondered if people considered it?

You send in the SAR at the end of January. HMRC have the next year to raise a query against it. In the case of errors or mis-applications of the rules they can then go back 6 years (i.e. the SAR + 5 years), for fraud it's unlimited but usually kept to 20 years. So any cover you need will be for the balance of the tax year following going permie plus one year.

[Bones]

It's fairly standard, it basically says you indemnify them against being liable for your tax, NI & penalties if you decide you're outside IR35 and HMRC disagree and win.

I have been looking at Tax Liability Cover but one thing that struck me was the fact that I am contracting but would accept a staff roll if a good one came along. This would mean the insurance would obviously end but how long after can HMRC still investigate your tax affairs for (5 years?). It just a general point I wondered if people considered it?

[doodab]

I have just got a new contract position through an agent as a LTD company and they have sent me the contract to sign. It has several paragraphs that put all responsibility for 'everything' on me. One of which is the paragraph headed INDEMNITY which states,

"The consultancy shall indemnity and keep indemnified the Employment Business against any losses suffered by the Employment Business by reason of any proceedings, claims or demands by any third party (including specifically but without limitation, HMRC and any successor, equivalent or related body pursuant to the IR35 legislation and/or any of the provisions of chapter 9 and/or section 688A of the tax (earnings and pensions) act 2003 and/or any supporting or consequential legislation relating thereto."

This sounds like I have to financially protect them from something I dont have control over? Has anyone seen similar clauses before?

It's fairly standard, it basically says you indemnify them against being liable for your tax, NI & penalties if you decide you're outside IR35 and HMRC disagree and win.

[Bones]

I have just got a new contract position through an agent as a LTD company and they have sent me the contract to sign. It has several paragraphs that put all responsibility for 'everything' on me. One of which is the paragraph headed INDEMNITY which states,

"The consultancy shall indemnity and keep indemnified the Employment Business against any losses suffered by the Employment Business by reason of any proceedings, claims or demands by any third party (including specifically but without limitation, HMRC and any successor, equivalent or related body pursuant to the IR35 legislation and/or any of the provisions of chapter 9 and/or section 688A of the tax (earnings and pensions) act 2003 and/or any supporting or consequential legislation relating thereto."

This sounds like I have to financially protect them from something I dont have control over? Has anyone seen similar clauses before?