Reply to: IR35 review roundtables

[FIERCE TANK BATTLE]

Nah the CEST tool is great, here's my client's responses to the questions:


> Does your client have the right to reject a substitute?
Yes, we don't want just anyone coming in, if you're sick for 2 months then we'll have to hire someone else, rather than get someone through you.

Does your client have the right to decide how the work is done?
> Yes we both decide, for example if we want to use kanban or scrum then we want the contractor to do that too.

> Does your client have the right to decide your working hours?
Yes we both decide because if there is a meeting for example we would want the contractor to attend.

> Does your client have the right to decide where you do the work?
We both decide because while we don't mind the contractor working from home or choosing their own hours there might be a time that we want them to attend a meeting or be in the office for that kind of reason.

> If the client was not happy with your work, would you have to put it right?
No, we don't ask people to do that, it's just not our policy to ask people to fix it so we wouldn't do that.

> Have you done any self-employed work of a similar nature for other clients in the last 12 months?
Well I put yes because you had a job before you worked on this contract right


Looking good guys. I'm sure that 70% isn't to do with confusing questions being sent to managers that had to google what IR35 was when orders came from above asking them to run through the tool.

If we can't stop IR35 at least we could perhaps ask HMRC to improve the explanations of its questions?

(Incidentally the reality if my situation is that, I decide exactly how I will implement their requirements, I am accountable to no-one in that regard, I liase with the end client to check things are going smoothly, dial into meetings and spend most of my time in their office because it's much easier. There is a strict statement of work. I work from home as and when I like, work only 3 days per week as per my contract, unless they request more in which case I sometimes accept and sometimes reject. I obviously offer to correct work and I have not done any self employed work in the last 12 months. But according to the tool, I am 'undetermined'.)

[JohntheBike]

[QUOTE=NeedTheSunshine;2717814]

To go all the way to the bitter/happy end through the tax tribunal process (assuming appeals are made etc) the costs are significantly more than that. High six figures. And this is a biggy for HMRC.

Employment tribunals are totally different and are not related in any way. And if I wanted employment rights I would be a perm employee.

And if I wanted employment rights I would be a perm employee

it's not about wanting employment rights, which none of us want. But when we are faced with the lying and devious HMRC, any weapon we can use against the system is fair game. You cannot deny that using the ET is clearly such a weapon. It worked for Susan Winchester, and it might still work for the current case that IPSE are supporting, even without any future cases.

It's very unlikely that an individual would appeal to the FTT. It would normally be the other way around, i.e. HMRC takes the individual to the FTT I would hope that anyone who gets that far has tax investigation insurance.

What baffles me is why none of those in the BBC who have been judged as subject to IR35 and have been obliged to pay the tax bills haven't approached the ET. I can only guess that the BBC has somehow defused their situations.

[NeedTheSunshine]

[QUOTE=JohntheBike;2717809]

Thing is, most contractors are burying their head in the sand. If you can't get people to turn up for a peaceful protest, get in touch with their MP etc even though HMRC could potentially be knocking at their door in the not too distant future asking for large amounts of back tax how will you find 100s of candidates to challenge a FTT determination? And you need pockets. Plus the stress of dragging it out for years and years as it rumbles through the courts. That's why contractors are easy pickings.[/QUOTe



My ET cost £2000 in 2000 and the EAT cost £6000 in 2002

£2000 is £3,391.78 in today's money.

£6000 is ££9,834.27 in today's money

To go all the way to the bitter/happy end through the tax tribunal process (assuming appeals are made etc) the costs are significantly more than that. High six figures. And this is a biggy for HMRC.

Employment tribunals are totally different and are not related in any way. And if I wanted employment rights I would be a perm employee.

[BR14]

Yawn....

quite

[northernladuk]

Yawn....

[JohntheBike]

[QUOTE=NeedTheSunshine;2717804]Thing is, most contractors are burying their head in the sand. If you can't get people to turn up for a peaceful protest, get in touch with their MP etc even though HMRC could potentially be knocking at their door in the not too distant future asking for large amounts of back tax how will you find 100s of candidates to challenge a FTT determination? And you need pockets. Plus the stress of dragging it out for years and years as it rumbles through the courts. That's why contractors are easy pickings.[/QUOTe

And you need pockets

My ET cost £2000 in 2000 and the EAT cost £6000 in 2002

£2000 is £3,391.78 in today's money.

£6000 is ££9,834.27 in today's money

[JohntheBike]

Pretty bad, at a guess. You may take your case to an FTT. If you lose, you appeal and HMRC drop the case to prevent setting case law. You win and HMRC don't appeal for the same reason. They don't want clarity.

What we need after April is some brave soul (or ideally several hundred of them) to challenge a determination at FTT on the basis that the determination is incorrect. Only then will we get some sort of sense to prevail.

to challenge a determination at FTT on the basis that the determination is incorrect.

or in the ET to accept that the determination is correct!

[NeedTheSunshine]

Pretty bad, at a guess. You may take your case to an FTT. If you lose, you appeal and HMRC drop the case to prevent setting case law. You win and HMRC don't appeal for the same reason. They don't want clarity.

What we need after April is some brave soul (or ideally several hundred of them) to challenge a determination at FTT on the basis that the determination is incorrect. Only then will we get some sort of sense to prevail.

Thing is, most contractors are burying their head in the sand. If you can't get people to turn up for a peaceful protest, get in touch with their MP etc even though HMRC could potentially be knocking at their door in the not too distant future asking for large amounts of back tax how will you find 100s of candidates to challenge a FTT determination? And you need deep pockets. Plus the stress of dragging it out for years and years as it rumbles through the courts. That's why contractors are easy pickings.

[malvolio]

I wonder what odds Betfair would give on that scenario?

Pretty bad, at a guess. You may take your case to an FTT. If you lose, you appeal and HMRC drop the case to prevent setting case law. You win and HMRC don't appeal for the same reason. They don't want clarity.

What we need after April is some brave soul (or ideally several hundred of them) to challenge a determination at FTT on the basis that the determination is incorrect. Only then will we get some sort of sense to prevail.

[simes]

I wonder what odds Betfair would give on that scenario?

Right now, probably not good.

But back in 2000 when IR35 was first introduced, and with just as little hardened experiences, what odds would Betfair have given contractors then to go up against HMRC? Much less win cases.

And now in 2019/early 2020, what odds would people have given for the same?

Fast forward to the first few court cases between Clients and HMRC and you just know where I will be putting my beans.

[NeedTheSunshine]

I can envisage the other scenario.

You were outside and now you've been erroneously declared inside.

A court case ensues and the contractor is found to be outside after all.

HMRC to cough up the back taxes.

Other clients look on with amazement and new found confidences...

I wonder what odds Betfair would give on that scenario?

[ladymuck]

I can envisage the other scenario.

You were outside and now you've been erroneously declared inside.

A court case ensues and the contractor is found to be outside after all.

HMRC to cough up the back taxes.

Other clients look on with amazement and new found confidences...

I love your sense of humour

[simes]

HMRC may be incompetent (totally agree with that) but they will get around to prosecuting people/sending enquiries/stopping obvious contractor Ltd companies shutting down etc. Not immediately but I bet they will be moving resources into this area. It's easy money. You were outside, now you're inside/perm at same client. Cough up the tax due. And it's not retrospective as your outside assessment pre April 2020 was incorrect.

And I also reckon that HMRC would believe about 90% of contractors should have been declaring inside but were declaring outside.

I can envisage the other scenario.

You were outside and now you've been erroneously declared inside.

A court case ensues and the contractor is found to be outside after all.

HMRC to cough up the back taxes.

Other clients look on with amazement and new found confidences...

[NeedTheSunshine]

Something along the lines of turning on the new rules but not prosecuting people that break them. Which sounds nice, but is a mechanism for allowing bad practices to develop and become normal.

In other words, the hugely incompetent HMRC once again failing to understand the damage they are doing.

HMRC may be incompetent (totally agree with that) but they will get around to prosecuting people/sending enquiries/stopping obvious contractor Ltd companies shutting down etc. Not immediately but I bet they will be moving resources into this area. It's easy money. You were outside, now you're inside/perm at same client. Cough up the tax due. And it's not retrospective as your outside assessment pre April 2020 was incorrect.

And I also reckon that HMRC would believe about 90% of contractors should have been declaring inside but were declaring outside.

[LetterBox]

Given that companies are already implementing their strategies - the damage has been done.

Nothing and no-one is going to fix things now as you can't turn back the clock and remove a blanket ban without looking foolish.

Or...

In 6 months time when things get worked out and these blanket ban businesses look to now be at a disadvantage, they then reach out to the market offering roles to FCs (Facilitation Companies). Blanket ban remains in place for PSCs.

World order is restored.