Reply to: Rishi Sunak confirms IR35 reform is going ahead w/o any major changes

[northernladuk]

Outside > Inside same client/agency
Outside > Inside different client/agency

Will these be treated the same? Or just the order at which HMRC broom handle comes flying?

How long before we can relax, 4, 6 or 20 years?

What do you mean by client/agency. Do mean client as well as agency or client or agency?

Question is too braid to be meaningfull.

[eek]

Outside > Inside same client/agency
Outside > Inside different client/agency

Will these be treated the same? Or just the order at which HMRC broom handle comes flying?

How long before we can relax, 4, 6 or 20 years?

Outside > Inside different client / agency you can argue it is an entirely separate contract with different working practices.

Try doing that at the same place.

Outside > Inside same place is a hard argument to justify that you were ever outside (see the Nationwide case), the other is very justifiable...

[SeededLoaf]

Outside > Inside same client
Outside > Inside different client

Will these be treated the same? Or just the order at which HMRC broom handle comes flying?

How long before we can relax, 4, 6 or 20 years?

[eek]

When is that flag set?

Inside IR35 -> paid via LTD?
Inside IR35 -> paid via Umbrella?
No IR35 Determination - paid via Umbrella?

A note re. the NI figures previously provided above: if someone has pension carry forward, and is willing to load up their existing pension, NI contributions can be reduced to < £1500 for the next tax year (and beyond). Granted, this is still different figures from payment to a director via a PSC.

I would suggest hitting google and seeing what RTI means in regards of payroll..

[jamesbrown]

When is that flag set?

Inside IR35 -> paid via LTD?
Inside IR35 -> paid via Umbrella?
No IR35 Determination - paid via Umbrella?

A note re. the NI figures previously provided above: if someone has pension carry forward, and is willing to load up their existing pension, NI contributions can be reduced to < £1500 for the next tax year (and beyond). Granted, this is still different figures from payment to a director via a PSC.

It’s a deemed payment flag. If the Fee Payer makes an IR35 deemed payment, the flag is set.

[Paralytic]

In terms of deemed payments, they don't need to look for anything indirect as there's a new RTI flag for when IR35 deemed payments are being made by the Fee Payer.

When is that flag set?

Inside IR35 -> paid via LTD?
Inside IR35 -> paid via Umbrella?
No IR35 Determination - paid via Umbrella?

A note re. the NI figures previously provided above: if someone has pension carry forward, and is willing to load up their existing pension, NI contributions can be reduced to < £1500 for the next tax year (and beyond). Granted, this is still different figures from payment to a director via a PSC.

[eek]

Ready To Investigate?

Well they need flags to cover all circumstances:-

Agency reporting says if you move from a PSC to an umbrella company
Deemed payments say you moved from a PSC to deemed payments by the agency.

Both set the same worth investigating flag on the account if the Agency remains the same.

Now the Deemed payments flag is probably there as a trigger for other consolidation reports but hey it exists and can be used for all appropriate uses.

[LondonManc]

In terms of deemed payments, they don't need to look for anything indirect as there's a new RTI flag for when IR35 deemed payments are being made by the Fee Payer.

Ready To Investigate?

[jamesbrown]

In terms of deemed payments, they don't need to look for anything indirect as there's a new RTI flag for when IR35 deemed payments are being made by the Fee Payer.

[LondonManc]

Moves you from one agency to another so looks like you've changed contract.

One large agency holding group (you can guess the name) did exactly that back in 2017 as that was how they had segmented things.

I doubt any agency would willingly do that in this scenario though - in the example above it was an internal holding company decision.

I suspect that HMRC won't look at that. They'd simply look at NI Number, Year, Month, NI Paid and look for the changes from 2018-2022 at a guess; watch the change as the 12 month spikes go to monthly steady payments and it's a target.

You're before and after April 6th status goes one of four ways:
Inside -> Inside - nothing to see here, business as usual
Inside -> Outside - as much chance of finding unicorn poop on Mars
Outside -> Outside - anyone with a CEST tool determination of outside and client confirmation will probably be right at the back of the queue
Outside -> Inside - probably switched from Aston Carter, TEK, etc to an Umbrella Company as your intermediary report source. These will be the vast majority of those still contracting and will be the main targets. They'll be looking at who carries on for a while - probably wait for Feb 2021 to get the SAs etc over the line before identifying targets. Who knows exactly but it's not going to be pleasant for those that have gone down this route and been at the same client for some time.

[eek]

Could you explain to us what your thinking is around changing and agent will affect NI paid?

Moves you from one agency to another so looks like you've changed contract.

One large agency holding group (you can guess the name) did exactly that back in 2017 as that was how they had segmented things.

I doubt any agency would willingly do that in this scenario though - in the example above it was an internal holding company decision.

[northernladuk]

Would changing the intermediary remedy this problem?
Most clients have more than 1 agency that supplies contractors.

Could you explain to us what your thinking is around changing and agent will affect NI paid?

[abz2020]

No, you add NI receipts and oh look what does it tell me

2019 - NI number - NI paid £400
2020 - NI number - NI paid £17000

Would changing the intermediary remedy this problem?
Most clients have more than 1 agency that supplies contractors.

[dsc]

Ok, i'm obviously beating a dead horse here, but, with the lack of *any* evidence that HMRC could know if someone moved from outside -> inside (as was stated), I'm still convinved that they can't.

Yes, I accept, from a risk perspective, there is little difference between going outside -> inside and outside -> Umbrella, but i never said otherwise.

Its interesting we've heard very little (on these boards) about those at GSK that got the letters.

There is evidence - eek explained how easy it is to spot a change in circumstances and HMRC doesn't need more than this to send you a nice letter.

[eek]

Ok, i'm obviously beating a dead horse here, but, with the lack of *any* evidence that HMRC could know if someone moved from outside -> inside (as was stated), I'm still convinved that they can't.

Yes, I accept, from a risk perspective, there is little difference between going outside -> inside and outside -> Umbrella, but i never said otherwise.

Its interesting we've heard very little (on these boards) about those at GSK that got the letters.

And our point is that if it looks like a sheep HMRC are going to treat it like a sheep even though 1 in 10(100/1000) of the sheep is actually a pig in a sheep costume.

And the lack of news from GSK tells us nothing other than HMRC will take their time before moving to the next stage as that is part of their methodology - scare people then do nothing for 9 months then scare again..