Re: FN-FORUM: Ir35 legislation & opting out ?

date posted 30th October 2007 21:25

Bit unnecessary isn't it Dawn? Unless I missed something, he was only
asking for advice - which is what the forum is about no?

Let's be nice to each other and let the IR be the nasty ones :)

Dawn Thomson wrote:
> Accountants ensure your employment status is clear and handle all of your
> tax issues - whether corporation, self-assessment, annual accounts, VAT,
> expense claims etc. and can act on your behalf with IR.
> Investigations can occur, especially where your employment status is
> suspect, and you are trying to diddle IR & HMRCE out of their money.
>
> If you want to check your contract for IR35 compliance, pass it onto an
> employment or contract lawyer and stop asking people on forums !
>
> ----- Original Message -----
> From: "Mike A" [EMAIL REMOVED]
> To: [EMAIL REMOVED]
> Sent: Tuesday, October 30, 2007 9:18 PM
> Subject: Re: FN-FORUM: Ir35 legislation & opting out ?
>
>
>> Dominic's feedback is well worth taking as the safe course.
>>
>> As for those that are in disagreement with my feedback: all I can say is
>> I've handled many tax tribunals for clients - it's all about the evidence.
>> If the evidence is that a person sought and acted upon advice from the
>> Revenue it is hugely unlikely the tribunal will go against them,
>> especially
>> if supported by a lack of intention to defeat the tax system. If that is
>> the
>> end result it is also the basis of advice at the beginning. Dominic's
>> suggestion of acting via an accountant comes with the protection of
>> credibility and professional indemnity.
>>
>> Mike A.
>>
>>
>>
>> ----- Original Message -----
>> From: "Dominic Raywood" [EMAIL REMOVED]
>> To: [EMAIL REMOVED]
>> Sent: Tuesday, October 30, 2007 8:59 PM
>> Subject: Re: FN-FORUM: Ir35 legislation & opting out ?
>>
>>
>>> Well guys; I may be able to offer some first hand experience here. I
>>> have
>>> a ltd company and mainly work with large companies either contracting
>>> direct, or via an agency (spit).
>>>
>>> I don;t know how much you spend running your company currently; but I pay
>>> an accountant Ł60 a month + vat and they do everything for me - payroll,
>>> vat returns, PAYE, annual returns, one personal tax return etc. I also
>>> made the rather excellent decision to join the Professional Contractors
>>> Group. I joined them when they started up and have not looked back. I
>>> pay them Ł200+vat per year.
>>>
>>> I recently had an IR35 investigation. The PCG dealt totally with the
>>> Inland Revenue; I didn't have to write, read or speak to them! All
>>> correspondence went directly between them. It ALL stemmed on contracts
>>> and nothing else - nothing! By ensuring I have IR35 friendly contracts,
>>> whether working via an agency, or direct; they all passed IR35. They
>>> gave
>>> me a clean bill of health after a very short investigation - which I
>>> believe is quite rare. All I have now to haggle about is expenses etc.
>>> The other big factor helping me I feel, was the minimal Web Design work I
>>> get - effectively meaning I have continuous multiple customers/clients.
>>> I
>>> also advertise by way of the website, Yellow Pages ads over the years
>>> etc.
>>> Basically, good contracts and avoiding ANY pointers to hidden employment
>>> e.g. turn down any free gym memberships, free parties. Try to use a
>>> personal email if they will let you. Don't fill in any holiday request
>>> forms - just tell them when you will be taking time off. Every client I
>>> have worked for understands about IR35 and they are all happy to help to
>>> a
>>> degree.
>>>
>>> I don't know how much you currently spend running your business, but my
>>> 1020+vat a year is it. I have had free banking since I started in 1996 -
>>> not one charge.
>>>
>>> Think of the costs as insurance. You'll probably be earning around 100k
>>> if you are contracting. 1% (tax deductible) is a small price. If you
>>> also register for VAT, that will return some of that Ł1020 anyway. I use
>>> the fixed price VAT scheme, where I charge 17.5%, but pay something like
>>> 13.5%? Basically, I can't claim VAT back when I spend, but I retain the
>>> 4% (or there abouts) on every invoice I raise. My accountant reckons I
>>> saved well over Ł1000 last year doing this - which has offset the "costs"
>>> of running my business. Add to that the ability to take a low salary and
>>> use dividends and the Employer's NI isn;t a big issue either.
>>>
>>> Most accountants will get you an off the shelf company for nothing in
>>> 24hrs.
>>>
>>> You will definitely pay more tax through an umbrella company - I
>>> guarantee
>>> it!
>>>
>>> In summary: If the work is lucrative enough, then the costs will be far
>>> out-weighed by the earnings. Join the PCG and make sure you use a
>>> contract recommended by them. Leave the contract discussions until after
>>> you have the contract offer. Then, hold out if the agency gets funny; I
>>> have found they will ALL move on contracts if they see their 10%-20%
>>> disappearing!
>>>
>>> Yes, running a company is a little hassle, but I don;t think a limited
>>> comany need be that onerous to be honest; especially if your accountant
>>> does 95% of the work for you, like mine does.
>>>
>>> If you have any specific questions: bank, accountant etc. feel free to
>>> contact me directly.
>>>
>>> :)
>>>
>>> Alain Williams wrote:
>>>> On Tue, Oct 30, 2007 at 06:46:29PM -0000, Phillip Healey wrote:
>>>>> I can't see how this is at all true. If it were, then it would
>>>>> effectively
>>>>> rule out any self-employed person from ever doing any work. With
>>>>> actually
>>>>> knowing 100% the facts, I would suggest that this is nothing more than
>>>>> paranoid nonsense from the company you are working with. They obviously
>>>>> think that pushing you into using an umbrella company will rid them of
>>>>> any
>>>>> risks they?ve dreamt up regarding taxation etc.
>>>> If you do a runner and don't pay your tax then the agency could
>>>> be liable to pay your tax. If they contract a Ltd company
>>>> then they don't have the liability. It is a small risk, but
>>>> they won't take it. Most contract agencies are like this.
>>>>
>>>>> Although I could be wrong, which would be very worrying.
>>>>>
>>>>> Regards
>>>>> Phill Healey
>>>>> Munklefish
>>>>> Po Box 70
>>>>> Manchester
>>>>> M34 3SQ
>>>>> T: 0161 408 4759
>>>>> ?
>>>>>
>>>>> -----Original Message-----
>>>>> From: [EMAIL REMOVED] [EMAIL REMOVED] On Behalf Of steve
>>>>> wilson
>>>>> Sent: 30 October 2007 18:28
>>>>> To: FN-FORUM / [EMAIL REMOVED]
>>>>> Subject: FN-FORUM: Ir35 legislation & opting out ?
>>>>>
>>>>>
>>>>> Hi guys,
>>>>>
>>>>> I am currently doing some freelance work via people4business. I am
>>>>> having to go through a umbrella company because of new legislation
>>>>> regarding any unpaid tax will be the responsiblity of the contract
>>>>> agency. So they need to cover themselves by making their sellers go
>>>>> through a umbrella company. This way, I basically pay tax as any normal
>>>>> 9-5 person would.
>>>>>
>>>>> The problem for me is, I have to pay admin costs to use the umbrella
>>>>> company, and also I would like to pay my tax at the end of the year
>>>>> like
>>>>> any normal freelancer.
>>>>>
>>>>> Does anyone know anything of this legislation and if there is a way
>>>>> around it ? Is the agency im using giving me the correct information ?
>>>>>
>>>>> I am told, the only way to get around this is to become a ltd company.
>>>>> But my earnings do not warrant this at the moment..it is a lot of
>>>>> paperwork and quite expensive.
>>>>>
>>>>> Also, is the opting out clause in people4business relating to this ir35
>>>>> legislation ?
>>>>>
>>>>> Any help or info is really appreciated.
>>>>>
>>>>
>>> --
>>> Dominic Raywood
>>> Rubicon Computer Services Limited
>>> W: http://rubiconcsl.com
>>> E: [EMAIL REMOVED]
>>> T: 08456 521 561 (+44 1823 698420)
>>> F: 08456 521 561
>>> M: 07050 204998 (+44 7811 252573)
>>> Skype: RubiconCSL
>>>
>>> --
>>> Freelancers, contractors earn more with Prosperity4
>>> Call 0870 870 4414 or visit www.prosperity4.com
>>> and benefit from Inland Revenue approved expenses today.
>>>
>>> To advertise here: http://www.freelancers.net/advertising.html
>>>
>>>
>> --
>> Freelancers, contractors earn more with Prosperity4
>> Call 0870 870 4414 or visit www.prosperity4.com
>> and benefit from Inland Revenue approved expenses today.
>>
>> To advertise here: http://www.freelancers.net/advertising.html
>>
>>

--
Dominic Raywood
Rubicon Computer Services Limited
W: http://rubiconcsl.com
E: [EMAIL REMOVED]
T: 08456 521 561 (+44 1823 698420)
F: 08456 521 561
M: 07050 204998 (+44 7811 252573)
Skype: RubiconCSL