Reply to: NHS Digital owe £4.3 million for getting IR35 wrong

[JohntheBike]

From reading the press releases, it doesn't look to me like Alcock completed CEST himself, nor did the client. The CEST "evidence" was that someone who was advising the lawyers had put the contract through CEST and answered the questions and got an outside IR35 determination.

yes, on further reading this looks like what happened.

[DeludedKitten]

they have already demonstrated the lie that this statement is in the Alcock case, where they tried to stop the CEST evidence being presented in court, without stating why they did not want the evidence submitted. I guess the case has been nobbled though, so any further details will not be forthcoming.

From reading the press releases, it doesn't look to me like Alcock completed CEST himself, nor did the client. The CEST "evidence" was that someone who was advising the lawyers had put the contract through CEST and answered the questions and got an outside IR35 determination.

[edison]

they have already demonstrated the lie that this statement is in the Alcock case, where they tried to stop the CEST evidence being presented in court, without stating why they did not want the evidence submitted. I guess the case has been nobbled though, so any further details will not be forthcoming.

News hot off the press - Alcock successful in appeal against HMRC. Sounds like the HMRC case was a bit of a fiasco in the end.

[DeludedKitten]

Wonder if they are likely to try and claw this back from the contractors themselves, or if HMRC will double dip by going after them all individually.

They can't. The law says the liability is for the fee payer.

[smatty]

Wonder if they are likely to try and claw this back from the contractors themselves, or if HMRC will double dip by going after them all individually.

[JohntheBike]

From the tools result page

"HMRC will stand by the result given unless a compliance check finds the information provided is not accurate.

HMRC will not stand by results achieved through contrived arrangements designed to get a particular outcome from the service. This would be treated as evidence of deliberate non-compliance with associated higher penalties.

HMRC can review your taxes for up to 20 years."

HMRC will stand by the result given unless a compliance check finds the information provided is not accurate.

they have already demonstrated the lie that this statement is in the Alcock case, where they tried to stop the CEST evidence being presented in court, without stating why they did not want the evidence submitted. I guess the case has been nobbled though, so any further details will not be forthcoming.

[DeludedKitten]

So, the NHS gets hit with a tax bill, on the grounds that HMRC need the money to fund, e.g. the NHS.

Someone should put that on the side of a bus.

"We taxed NHS Digital £4.3 million because CEST is bobbins and we lied. Let's give that to the NHS instead"

[simes]

This is my point.
It completely negates the CEST because even if you are outside, all they have to say is the wrong information was put in and so no they dont have to standy by it.

Deary me.

This sounds like the comment on another thread about their "Not looking into past tax practices if found to be going from Outside to Inside IR35 from April 2020 - Unless fraud or criminal activities are suspected."

In other words, nothing the HMRC say is worth the time spent reading it.

If this were not the Professional forum, I would be adding many 'winker' emojis.

[MonkeysUncle]

I guess will have been their get-out: The wrong information was provided to the tool, not that the tool was wrong.

This is my point.
It completely negates the CEST because even if you are outside, all they have to say is the wrong information was put in and so no they dont have to standy by it.

[Paralytic]

From the tools result page

"HMRC will stand by the result given unless a compliance check finds the information provided is not accurate.

HMRC will not stand by results achieved through contrived arrangements designed to get a particular outcome from the service. This would be treated as evidence of deliberate non-compliance with associated higher penalties.

HMRC can review your taxes for up to 20 years."

I guess this will have been their get-out: The wrong information was provided to the tool, not that the tool was wrong.

[NotAllThere]

So, the NHS gets hit with a tax bill, on the grounds that HMRC need the money to fund, e.g. the NHS.

[mudskipper]

From the tools result page

"HMRC will stand by the result given unless a compliance check finds the information provided is not accurate.

HMRC will not stand by results achieved through contrived arrangements designed to get a particular outcome from the service. This would be treated as evidence of deliberate non-compliance with associated higher penalties.

HMRC can review your taxes for up to 20 years."

[MonkeysUncle]

Have HMRC ever said that?

I am sure they did (initially at least) and I know its been mentioned on here a few times when people have asked, responses have been carry out CEST, if it shows outside get the client to sign it and this will hold up in an investigation.....seems not now

EDIT: HMRC: We 'rigorously tested' IR35 tax-check tool... but have almost nothing to show for it • The Register

An HMRC spokesman reiterated this, adding that the CEST service "reflects employment status case law and has been rigorously tested throughout development". HMRC is "confident" in its accuracy, he said, and will stand by the results it generates.

Granted this was back in Feb

[Paralytic]

So essentially the whole practice of run the CEST. If it shows outside, get the end client to sign it and HMRC will stand by it is a load of tulip.

If HMRC wont even stand by their own tool then what is the point in running it in the first place!

Have HMRC ever said that?

[MonkeysUncle]

NHS handed GBP4.3m IR35 bill despite using CEST

So essentially the whole practice of run the CEST. If it shows outside, get the end client to sign it and HMRC will stand by it is a load of tulip.

If HMRC wont even stand by their own tool then what is the point in running it in the first place!