Public sector IR35 consultation launched

[teapot418]

https://www.gov.uk/government/consul...es-legislation

Includes the summary of responses to last summer's discussion document.

[jamesbrown]

The government is aware from the summer discussion this would require some public
sector organisations and agencies to join up separate systems they have for payroll and
for paying invoices. Some stakeholders told us these can be on different computer
systems. The government recognises that time is needed for organisations to receive
(and in some cases develop) the necessary software upgrades and put reporting
systems in place, which is why the new rules will not come into force until April 2017.

For workers in the public sector this reform changes which party is liable to decide if a
payment should be taxed as employment income. No changes will be made to existing
employment law.

There will be a statutory right to appeal against the tax and National Insurance liability.
Where a PSC or an engager disagree with a determination that the new rules apply, the
PSC and/or engager will be able to request a formal review of the decision and to appeal
that decision to the tribunal in the same way as other Pay As You Earn and National
Insurance decisions and determinations.

Forgive them, for they know not what they've done.

But the key to all this working (or not) is on p. 26. Essentially, if you (as an engager) can demonstrate lack of personal service and control, no further testing is required. If you can demonstrate one of these things, the new digital ESI must be used. There's no MoO test, i.e. they've opted for two elements of the existing IR35, despite what they say about retaining the legislation "as is". Sounds as though they've canned SDC for now too.

[eek]

Page 14 example 3

Every consultancy that uses contractors has a problem - and HMRC has a very big problem up in Newcastle. Shall I make the formal complaint on April 6th or wait to later in April 2017...

As does the document - as it has no example 5 (was it stupid or did it give the game away)...

[GB9]

In some ways we will at least get some clarity.

The important bit will be to run the tests prior to contract so everyone knows the situation upfront. I doubt this will happen in all cases and look forward to the first threads along the lines of 'agent told me it was outside but the client has run the tests and it's inside'.

[northernladuk]

Any guesses as to how they will apply these. I am guessing day before you are outside, on the day you are in? No chance they only apply to new sign-ups and continue as normal with existing contracts and frameworks?

[eek]

Any guesses as to how they will apply these. I am guessing day before you are outside, on the day you are in? No chance they only apply to new sign-ups and continue as normal with existing contracts and frameworks?

I'm out of this client come what may on the 31st March 2017....

[eek]

In some ways we will at least get some clarity.

The important bit will be to run the tests prior to contract so everyone knows the situation upfront. I doubt this will happen in all cases and look forward to the first threads along the lines of 'agent told me it was outside but the client has run the tests and it's inside'.

Read the document. The logic goes working through an agency - client passes test to agency to deal with.

Personally unless this is dropped Public Sector = no thanks come 1/4/17.... As I've said for a while you need to get up and out of the way.

[missinggreenfields]

Any guesses as to how they will apply these. I am guessing day before you are outside, on the day you are in? No chance they only apply to new sign-ups and continue as normal with existing contracts and frameworks?

More likely that they rule you inside and then say "nothing's changed, so you were always inside, that'll be £90k please"

[GB9]

Read the document. The logic goes working through an agency - client passes test to agency to deal with.

Personally unless this is dropped Public Sector = no thanks come 1/4/17.... As I've said for a while you need to get up and out of the way.

If that's the case then agency should be able to state whether inside or outside at the time of advertising. I would want written confirmation from both.

[northernladuk]

If that's the case then agency should be able to state whether inside or outside at the time of advertising. I would want written confirmation from both.

Not so sure it's the agencies responsibilities or within their risk profile to state that? They advertise the role. It's up-to us to decide no?