Reply to: Retrospective IR35 investigations

[northernladuk]

Does going from out-IR35 to FTC invite the same retrospective exposure as going from out-IR35 to in-IR35?

Work through what each is, how the contract moved to that and what comparisons exist and then give us your best guess so we can add comment where need be.

People need to understand what is going on and have a good chance of getting the right answer rather than just asking and continuing not to understand what is happening.

[PerfectStorm]

Does going from out-IR35 to agency FTC invite the same retrospective exposure as going from out-IR35 to in-IR35?

[PerfectStorm]

Does going from out-IR35 to FTC invite the same retrospective exposure as going from out-IR35 to in-IR35?

[JohntheBike]

And when he realises that NINO numbers aren't necessarily unique that'll really blow his mind.

just like car registration numbers.

[Lance]

Can't wait until he has to apply for DBS. He'll have a coronary.

And when he realises that NINO numbers aren't necessarily unique that'll really blow his mind.

[jamesbrown]

where's it going to end?

With a much smaller contracting market, a lot of pass the parcel, chaos for a year or so, and then the dust will settle and we'll see the aftermath, which could be anywhere from much recovered to nuked from orbit (take your pick). I doubt it will recover to anything like the recent past though as most of these large companies have made policy decisions that will be hard to reverse.

[ascender]

They've really not thought any of this through have they? Talking to a manager form a previous client, they're now being hit from all sides and while the "job swap" idea is a great one in theory, it doesn't appear to be very practical.

• Quite a few contractors have given notice because there is no increase to day rates to help offset the loss in revenue.
• Some are being offered permanent positions but on "terrible" money - so they're going to leave.
• Many of those who had previously decided to stay through a brolly company have now changed their mind due to the coverage of the retrospective investigations over the last week or so.
• They had quite a few contractors in their team who weren't local - as the ability to claim expenses have also gone, they've also given notice.
• Some are obviously just taking it as a chance to retire or do something else.

Presumably, this scenario is playing-out at clients all over the UK, so where's it going to end? Apart from those with really niche skills, is it just going to keep driving rates down as there's going to be a lot of people out there who are desperate for the work and will just take whatever day rate is on offer? Clients will quickly get wind of that and take advantage of it?

[Peoplesoft bloke]

I think the clarification at the end wasn't required but nice touch.

I'm not really qualified to judge on anything else - but he has no idea how NI, RTI or NI numbers work (unless he has done a lot of reading since posting).

[northernladuk]

100% true and I hurriedly retracted my original comment.

The substantive points remain -

NI number doesn't tell you anything about whether or not NI needs to be deducted.

Johnthebike doesn't know what he's talking about (in relation to NI numbers)

I think the clarification at the end wasn't required but nice touch.

[Peoplesoft bloke]

from HMG
'What to do when an employee reaches State Pension age
You need to update your payroll records when one of your employees reaches State Pension age so they stop paying National Insurance.

Reporting and paying
Change their National Insurance category letter to ‘C’ in your payroll software - this means you’ll stop deducting National Insurance from their pay. You still need to pay employer’s contributions for them.

Carry on reporting year-to-date information under the old category letter until the end of the tax year.

which means yout brolly will deduct them.
and your Ltd should too.

100% true and I hurriedly retracted my original comment.

The substantive points remain -

NI number doesn't tell you anything about whether or not NI needs to be deducted.

Johnthebike doesn't know what he's talking about (in relation to NI numbers)

[BR14]

from HMG
'What to do when an employee reaches State Pension age
You need to update your payroll records when one of your employees reaches State Pension age so they stop paying National Insurance.

Reporting and paying
Change their National Insurance category letter to ‘C’ in your payroll software - this means you’ll stop deducting National Insurance from their pay. You still need to pay employer’s contributions for them.

Carry on reporting year-to-date information under the old category letter until the end of the tax year.

which means yout brolly will deduct them.
and your Ltd should too.

[Peoplesoft bloke]

ftfy

Fair point well made.

[BR14]

As I explained, the rules are complex, but they have NOTHING to do with your NI number.

As one simple example - if you are aged over state pension age, you don't pay EE's NI. Employers/Brollies are expected to know this from DOB of the worker measured against published state pension ages. They couldn't in any way derive it from your NI number.

I'm not going answer any more questions on this - the information is all out there if you want to actually find out how the system works rather than assuming you know when you clearly don't.

ftfy

[Peoplesoft bloke]

so, what information is used to determine that anyone is not liable to pay NI?

As I explained, the rules are complex, but they have NOTHING to do with your NI number.

As one simple example - if you are aged over state pension age, you don't pay NI. Employers/Brollies are expected to know this from DOB of the worker measured against published state pension ages. They couldn't in any way derive it from your NI number.

I'm not going answer any more questions on this - the information is all out there if you want to actually find out how the system works rather than assuming you know when you clearly don't.

[JohntheBike]

Whether or not you should pay NI has nothing to do with your NI number.
The rules on who pays NI and what rate are pretty complex - have a look at the government stuff online if you have a few hours to spare. They have nothing at all to do with having (or not having) an NI number.

Whether or not you should pay NI has nothing to do with your NI number.

so, what information is used to determine that anyone is not liable to pay NI?