Inside IR35... then Outside IR35?

[gcool01]

Can you start a new thread rather than take an existing one off topic please.

Thanks , Will do that.

[northernladuk]

Can you start a new thread rather than take an existing one off topic please.

[gcool01]

Inside IR35... Client offering Outside IR35 but asking personal Indemnity??

This is my first post and I did search for this scenario in the earlier post and could not find any queries similar to my situation.

I have a strange case at my current contract. SDS came as inside but client is now offering to change working practice to make the contract Outside IR35. In doing so they are offering insurance on the contract which we will have to pay approx £200 per yr or £150 per contract. Which is ok but below two points are also part of this.

1. The insurance-backing described covers £100k of legal fees and £100k per year of cover for income tax , NI payments and associated interest and penalties, which should protect both The Agency and my company against HMRC claims. However it’s just possible this could be invalidated if the insurance company concludes that the SIFT test ( insurance company equivalent of CEST) has not been properly completed.
2. Agency will maintain in place in the contract between us the indemnity which means that we will still be required to reimburse Agency for any payments of tax, NI and associated interest and penalties that are levied against Agency with respect to the payments being made for my company’s services that are not covered by the insurance for any reason.


In these circumstances do you advise to take the offered Outside IR35 contract at the current agency or better to have a Inside IR35 contract at some other client. Any suggestions if this is a normal practice of Agency who are offering Outside IR35 contract post April 2020 or just once off case?

Thanks in Advance.

[ladymuck]

So they gave you the SDS and it didn't explain how they came to that decision?

It's not a valid determination if you haven't been issued with the SDS.

Once you have that, you can see where your idea of the working practices is different to theirs and follow their legally mandated (when the bill passes next month) appeals process.

[northernladuk]

My determination came back Inside IR35. Hiring manager has told me he wants me to stay on and get an extension past my end date 28 FEB. If the working days on the contract were variable, say 3 or 4 days per week, could that help strengthen the MoO issue and get a valid outside determination?

No.

Now is the time, more than ever, you need to understand IR35 and not just guess and ask questions like this.

[dsc]

What's the inside determination based on? CEST? their own thinking? some outside company doing assessments? is it true inside or are they banning engaging via ltd from April?

It's nice that the manager wants you to stay, but it's your ass on the line if you go past April and they deem you inside so carrying on is basically admitting to HMRC that you were inside / employee all this time. No idea how long you've been there already, so maybe it's not a biggy, but most people in your situation would leave simply to avoid the possibility of an investigation.

[SimonMac]

My determination came back Inside IR35. Hiring manager has told me he wants me to stay on and get an extension past my end date 28 FEB. If the working days on the contract were variable, say 3 or 4 days per week, could that help strengthen the MoO issue and get a valid outside determination?

Dunno, ask them how they got the inside determination and go from there

[hgllgh]

My determination came back Inside IR35. Hiring manager has told me he wants me to stay on and get an extension past my end date 28 FEB. If the working days on the contract were variable, say 3 or 4 days per week, could that help strengthen the MoO issue and get a valid outside determination?