SDS Inside Received after 6 month contract and moving to Umbrella

[WordIsBond]

He legitimately thought he was outside and has a QDOS review to back that claim.

Client disagrees. So he goes umbrella and closes his company. If HMRC starts an investigation and stops him closing his company, then as noted he can just change his tax treatment of this year and tell HMRC he's done so and end the matter.

People with six months are not the ones HMRC most want to target.

It's the people who stayed for 11 years that are in trouble, not this guy.

[Paralytic]

He's going to hold his hands up and organise payment before end of this tax year so that he is in the clear.

Its 6 months worth of taxes that would be paid in light of new information (SDS) that gave clarity on the working practises during his 6 month period. Why would HMRC have an issue with this?

This. There can a tendency on these boards (more recently served with undertones of schadenfreude) to always respond with a doom-and-gloom story.

If they have been at the client for only 6 months, and want to self-declare as inside for that time, just get the accountant to fix that retrospectively for this tax year. No need to advise HMRC of anything (outside of usual reporting) - just summit accounts/Self Assessment as normal.

[eldy]

He's going to hold his hands up and organise payment before end of this tax year so that he is in the clear.

Its 6 months worth of taxes that would be paid in light of new information (SDS) that gave clarity on the working practises during his 6 month period. Why would HMRC have an issue with this?

[northernladuk]

Plus interest and possible penalties and a messy investigation.

Is he planning on doing this when they catch him or just hold his hands up or declare inside all along so he's in the clear?

[eldy]

Hi,

Friend operating under a LTD has just received a Inside SDS and has been asked to move to Umbrella in April.

QDOS did review the initial contract and reached an Outside status after getting a few things clarified but friend is really keen to stay with client and move over to Umbrella in April as getting increase in day rate.

How should he get HMRC off his back if he gets flagged for fraud some point in the future?

Is it just a matter of asking the accountant to calculate the 6 months worth of taxes due, inform HMRC these are to be paid, and pay them before the tax year ends?

Then will advise him to close down LTD in April via MVL.