Reply to: IR35 PS - So anyone had the discussion yet?

[northernladuk]

How about substitution ? Locum doctors are working anyway under "substitution" as in for example if unable to go to work your agency would send someonelse. So with with a legal substitution contract should be outside IR35

That's temping which should automatically put you inside. I'd suggest you go read up what substitution is. Plenty of articles on Google.

Try not to duplicate the question as well please.

[Moumunne]

How about substitution ? Locum doctors are working anyway under "substitution" as in for example if unable to go to work your agency would send someonelse. So with with a legal substitution contract should be outside IR35

[teapot418]

But if you are inside IR35 you can't charge VAT. (I may be wrong about this)

If you are outside you can.

So surely HMRC is losing VAT?

If you are operating through a ltd company, and are VAT registered, you need to add VAT whether or not you are IR35 caught. One of the examples covers this.

[RonBW]

I see from another post that MSC where banned in 2000 - sorry but I don't know much about that, there is a steep learning curve of decades of employment laws, tax laws, stupid schemes HMRC have tried in the past etc. All you had to do was say in the other post "That is an MSC and they were banned", but of course you rather just spit out abuse.

The legislation removing the tax advantages of an MSC was announced in December 2006 and introduced in 2007.

I don't see your suggestion as being akin to an MSC, though.

[LondonManc]

Corporation tax and Dividend tax covers income tax and just about covers employees NI. It doesn't cover employers ni. Look at what an umbrella company calculator shows and then look at what you get after dividend tax.

To be honest, the business NI should be covered by the client if I'm treated as an employee; the umbrella are, to all intents and purposes, the end client's payroll company.

[eek]

The dividend tax will go a long way to clawing that back though, especially for those that are taking, say, 60k a year out of their limited co.

Corporation tax and Dividend tax covers income tax and just about covers employees NI. It doesn't cover employers ni. Look at what an umbrella company calculator shows and then look at what you get after dividend tax.

[PurpleGorilla]

Regardless if you charge/claim VAT under ltd or umbrella - HMRC gets the same amount of VAT, either from you, the ClientCo, the agency or combination of all. There are some exceptions when ClientCo is not VAT registered but it doesn't include the PSBs that this thread is about.

Thanks, wasn't clear on that. [emoji106]🏾

[sal]

Do you claim VAT if you are in an umbrella?

I think not.

Regardless if you charge/claim VAT under ltd or umbrella - HMRC gets the same amount of VAT, either from you, the umbrella, the ClientCo, the agency or combination of all. There are some exceptions when ClientCo is not VAT registered but it doesn't include the PSBs that this thread is about.

[LondonManc]

VAT is irrelevant when it comes to HMRC arguments. Corp Tax and dividend tax are roughly equal to income tax. It's NI and especially Employers NI that this argument is about....

The dividend tax will go a long way to clawing that back though, especially for those that are taking, say, 60k a year out of their limited co.

[eek]

Do you claim VAT if you are in an umbrella?

I think not.

The umbrella does - you just don't see the paperwork

[PurpleGorilla]

No HMRC is not losing VAT, learn how VAT works it has been explained a million times in the last couple of weeks in various IR35 threads alone.

Do you claim VAT if you are in an umbrella?

I think not.

[sal]

But if you are inside IR35 you can't charge VAT. (I may be wrong about this)

If you are outside you can.

So surely HMRC is losing VAT?

No HMRC is not losing VAT, learn how VAT works it has been explained a million times in the last couple of weeks in various IR35 threads alone.

[breaktwister]

I mean, he's proposing an MSC currently.... :|

If we don't constantly correct him how are they going to know what's worth reading and what isn't. I just. Don't think the ignore button is the whole solution.

I see from another post that MSC where banned in 2000 - sorry but I don't know much about that, there is a steep learning curve of decades of employment laws, tax laws, stupid schemes HMRC have tried in the past etc. All you had to do was say in the other post "That is an MSC and they were banned", but of course you rather just spit out abuse.

If everyone had the time to gather all this knowledge themselves what would the point of the forum be? Just a place for you and your mates to hang out? If that's what you want why don't you stay in the "fun chat" area and stop attempting to abuse people for wanting to discuss ideas.

[PurpleGorilla]

IR35 PS - So anyone had the discussion yet?

VAT is irrelevant when it comes to HMRC arguments. Corp Tax and dividend tax are roughly equal to income tax. It's NI and especially Employers NI that this argument is about....

But if you are inside IR35 you can't charge VAT. (I may be wrong about this)

If you are outside you can.

So surely HMRC is losing VAT?

[eek]

When you add VAT, Corp Tax, Income Tax, NI, and Dividend Tax; that could be a tidy amount for HMRC.

Is all this IR35 nonsense really worth it?

VAT is irrelevant when it comes to HMRC arguments. Corp Tax and dividend tax are roughly equal to income tax. It's NI and especially Employers NI that this argument is about....