Reply to: Client Confirmation letter of previous status

[Tertius]

Agree, it would need to be something very different, not roughly the same thing in roughly the same way (and, honestly, I doubt it is something different, because the OP is arguing for things like "a change in role title", which is like giving a dog a cat mask and calling it a cat).

The new contract on offer is Temp Worker PAYE via Agency (same agency).

new role window dressing, is Credit Risk Delivery Consultant from Market Risk BA.

[jamesbrown]

Agreed - but it depends if PAYE means perm or inside. If Inside then I'd want a brand new contract and WP statement that both reflect how much inside I am.

Agree, it would need to be something very different, not roughly the same thing in roughly the same way (and, honestly, I doubt it is something different, because the OP is arguing for things like "a change in role title", which is like giving a dog a cat mask and calling it a cat).

[WordIsBond]

But it does so no more effectively than the contract, and considerably less so than evidence about actual WPs.

I beg to differ. Well, partly. It's certainly less important than evidence about actual WPs.

But it's better than the contract, in two ways.

First, the contract undoubtedly said the same thing, at the beginning of the engagement. The proposed statement says so at the end, confirming that the same understanding held throughout the engagement, and was therefore not merely a statement of intent that may have drifted.

Second, the contract did not have the change of status in view. The proposed statement has it fully in view, and is establishing that the change of status is indeed a change, and is viewed as such by both parties.

The contract would do nothing to refute an HMRC argument that "you accepted a PAYE role, that proves it should have been PAYE all along." The statement says that the transition to PAYE was not because of working practices or intent but because of a client policy decision. The contract can't help on that point, the proposed statement can.

As to your comments about whether the client would give such a statement, it depends. I've given reasons why they might. If OP sees value in the statement, he can ask for it. It's unlikely to do any harm. Most clients would like to keep their contractors, that's why they are offering PAYE roles. They aren't interested in taking significant risks but we are hearing things about clients being willing to do some things to help their contractors.

[LondonManc]

Yeah, it was ambiguous. But hopefully we've set them straight on that. Continuing with a different tax treatment under the same hypothetical contract would be nuts.

Agreed - but it depends if PAYE means perm or inside. If Inside then I'd want a brand new contract and WP statement that both reflect how much inside I am.

[jamesbrown]

The issue is that any future investigation would only be able to consider current working practices as they are at the time, which will be under a PAYE Temp Worker contract. A contract for which I am happy for them to have direction and control and all that, as it would create as much difference as possible to my soon to be ex LtdCo contract. It would be harder for them to assess how WPs were previously.

Eh? Why would an IR35 compliance check be interested in your PAYE employment, in the first instance (they might later, but only as context)? The whole point is to establish your WP under a hypothetical contract when you were claiming to be self-employed for tax purposes, except you weren't (or were, TBD).

The more bits of paper I can provide to prove this separation the better.

Sure, but not all evidence is equal. A general statement from the client along the lines you propose is the bog roll of evidence.

WPs proof (WFH when i want without notification. Non working days without restriction or requesting. Work hours I want. Refuse to use ClientCo absence tracker etc).

Yes, focus on this stuff.

New contract with me personally with basic Temp rights. vs LtdCo Contract (QDOS assessed outside)

Very dangerous game. You'd be very silly to continue doing essentially the same thing in essentially the same way under a different tax treatment. A tribunal judge will look a straight through any window dressing and get right to the reality, and you really don't want the hassle/stress of an investigation anyway.

New role title vs Old role title

Irrelevant window dressing.

I am proposing a statement from Client confirming their justification for blanket ban and that it does not imply that my role was 'unofficially' assessed inside, and that they maintain it was a contract of self-employment (as WiB suggests)

Irrelevant window dressing.

If I sign it will be short term until I find a new role elsewhere, hopefully a couple months. LtdCo closing by strike off asap, as will prob only be around 45k left in.

Bad plan. Length of engagement is irrelevant. If you're doing essentially the same thing in the same way, you're putting a "kick me" sign on your back.

[northernladuk]

Confirmation of Arrangements have been around along time and are notoriously difficult to do properly. Getting a client to sign it and finding someone in the organisation that is actually correct person to sign is very difficult. Getting your client line manager is not the person as they do not have the responsibility or authority to make decisions on WPs.

If you have been keeping a file of evidence over the period, a professional checked contract that is a pass and your WPs match then there isn't much else that will really help much. Fill your boots if you want to do it but don't be too sure it really makes a difference. Don't rock the boat to try get it either.

[Tertius]

But it does so no more effectively than the contract, and considerably less so than evidence about actual WPs.

The contract states the historical relationship, together with the actual working practices, which together inform the hypothetical contract. No general statement from the client about future arrangements is going to change that. If the OP were moving from outside to inside under the same T&Cs, then that would factor into the hypothetical contract because it involves a change in the tax status of the same worker under the same hypothetical contract. A tribunal is not going to be focused on general statements about other workers, especially after the OP has rejected those terms explicitly and they have direct evidence about the WPs as they were understood at the time the hypothetical contract applied.

By all means, acquire a CoA, if possible, but use one of the standard templates, which will be signed and dated. In practice, I cannot see why the client would offer one in the situation described. They mostly don't understand these reforms and their legal and compliance people aren't going to let them mess around with any unnecessary pseudo-legalese in that context.

The issue is that any future investigation would only be able to consider current working practices as they are at the time, which will be under a PAYE Temp Worker contract. A contract for which I am happy for them to have direction and control and all that, as it would create as much difference as possible to my soon to be ex LtdCo contract. It would be harder for them to assess how WPs were previously.

The more bits of paper I can provide to prove this separation the better.
WPs proof (WFH when i want without notification. Non working days without restriction or requesting. Work hours I want. Refuse to use ClientCo absence tracker etc).
New contract with me personally with basic Temp rights. vs LtdCo Contract (QDOS assessed outside)
New role title vs Old role title

I am proposing a statement from Client confirming their justification for blanket ban and that it does not imply that my role was 'unofficially' assessed inside, and that they maintain it was a contract of self-employment (as WiB suggests)

If I sign it will be short term until I find a new role elsewhere, hopefully a couple months. LtdCo closing by strike off asap, as will prob only be around 45k left in.

[jamesbrown]

Initial post suggests the opposite of walking....

Yeah, it was ambiguous. But hopefully we've set them straight on that. Continuing with a different tax treatment under the same hypothetical contract would be nuts.

[LondonManc]

Then you've done your due diligence, well done. You're also walking (I assume). Beyond collecting actual evidence about your WPs, there's nothing more to do (except hope for the best).

Initial post suggests the opposite of walking....

[jamesbrown]

QDOS and Abbey Tax assessments both confirm it. Also have QDOS insurance.

Then you've done your due diligence, well done. You're also walking (I assume). Beyond collecting actual evidence about your WPs, there's nothing more to do (except hope for the best).

[Tertius]

You're already with RS?

Sounds like you're almost under the bus already.

What makes you think your previous contract was outside IR35, other than you declaring it to be?

QDOS and Abbey Tax assessments both confirm it. Also have QDOS insurance.

[jamesbrown]

The statement is worth one thing -- to negate any HMRC argument that the new engagement proves he should have been inside historically.

It's like all the other little things you put in your IR35 dossier to show you aren't controlled, are in business for yourself, etc. I've got lots of pieces of paper that strengthen one of my arguments or refute a potential HMRC argument. Few of those pieces of paper are all that weighty in and of themselves.

If OP didn't have the kind of evidence you describe, he's in trouble no matter what. But if he does have that evidence, he doesn't want to lose a case anyway because a tribunal listens to HMRC arguing that his current engagement proves his old one was inside IR35.

But it does so no more effectively than the contract, and considerably less so than evidence about actual WPs.

The contract states the historical relationship, together with the actual working practices, which together inform the hypothetical contract. No general statement from the client about future arrangements is going to change that. If the OP were moving from outside to inside under the same T&Cs, then that would factor into the hypothetical contract because it involves a change in the tax status of the same worker under the same hypothetical contract. A tribunal is not going to be focused on general statements about other workers, especially after the OP has rejected those terms explicitly and they have direct evidence about the WPs as they were understood at the time the hypothetical contract applied.

By all means, acquire a CoA, if possible, but use one of the standard templates, which will be signed and dated. In practice, I cannot see why the client would offer one in the situation described. They mostly don't understand these reforms and their legal and compliance people aren't going to let them mess around with any unnecessary pseudo-legalese in that context.

[northernladuk]

You like the guy she's cheating with?

Hmm OK. Not quite what I meant...

[WordIsBond]

Oi.. Don't you be spoiling it. I'm on a good thing here.

You like the guy she's cheating with?

[WordIsBond]

WiB, that sort of statement is going to be mostly worthless in building a hypothetical contract at tribunal. The point of a CoA is to clarify/add flavour to the contractual terms w/r to the various IR35 pointers. Any blanket statement like that is close to worthless. Have you ever signed a contract that doesn't already have something like that w/r to being an independent contractor? The contract already states the view of both parties in general terms.

If the OP wants to make some effort in doing something to clarify their historical status, then they should collect evidence of that status, which will most definitely hold weight, unlike a general statement akin to what the contract probably already contains.

The statement is worth one thing -- to negate any HMRC argument that the new engagement proves he should have been inside historically.

It's like all the other little things you put in your IR35 dossier to show you aren't controlled, are in business for yourself, etc. I've got lots of pieces of paper that strengthen one of my arguments or refute a potential HMRC argument. Few of those pieces of paper are all that weighty in and of themselves.

If OP didn't have the kind of evidence you describe, he's in trouble no matter what. But if he does have that evidence, he doesn't want to lose a case anyway because a tribunal listens to HMRC arguing that his current engagement proves his old one was inside IR35.