Contractors: IR35 & general discussion

[Gazzab]

15 years and converting to perm. If I was him I would leave - moving to perm is the same as being inside. He Is flagging to hmrc that he’s been perm all along but under paid his tax by quite some margin. Not sure how far back that hmrc will go but I guess it’s maybe 6 years? He needs to run for the hills.

[anonymous-user]

I have a meeting with my accountant in a couple of weeks, during which I will certainly be discussing IR35 with him.

But in the meantime, what does anyone think may happen in my situation?

I’m a property/housing consultant working as a limited company.

My clients are mostly housing associations, councils, and housing providers.

I work on short term projects for numerous different clients. My work for each client can last anywhere from one or two days, to 12 months.

Like any consultant, I get called into places when they lack the expertise or manpower to complete a particular task, or have a problem they cannot solve on their own.

I usually work with 2 or 3 different clients at any one time. 2 days per week with one, 2 days a week with a different one and so on.

Thanks

[bigandclever]

Lord Marylebone said:

Lots of stuff about running a business, providing expertise for multiple clients as and when required, augmenting their business with specific skills on a short-term basis.

common sense said:

You’re fine.

HMRC said:

Fire up the taxation time machine, you are fubarred my son.

[Gazzab]

Lord Marylebone said:

I have a meeting with my accountant in a couple of weeks, during which I will certainly be discussing IR35 with him.

But in the meantime, what does anyone think may happen in my situation?

I’m a property/housing consultant working as a limited company.

My clients are mostly housing associations, councils, and housing providers.

I work on short term projects for numerous different clients. My work for each client can last anywhere from one or two days, to 12 months.

Like any consultant, I get called into places when they lack the expertise or manpower to complete a particular task, or have a problem they cannot solve on their own.

I usually work with 2 or 3 different clients at any one time. 2 days per week with one, 2 days a week with a different one and so on.

Thanks

I guess it depends what your clients say? For those clients that are small enough then off payroll doesn’t apply and you continue to self determine. Surely the larger ones will need to determine your status (flip a coin).

[anonymous-user]

bigandclever said:

Lord Marylebone said:

Lots of stuff about running a business, providing expertise for multiple clients as and when required, augmenting their business with specific skills on a short-term basis.

common sense said:

You’re fine.

HMRC said:

Fire up the taxation time machine, you are fubarred my son.

The only good news in all of this, is that I’ve only been doing it 11 months, having previously built up and then sold my former business.

So HMRC can fire up their time-travelling DeLorean Tax Machine all they want, there won’t be much to come after.

[Countdown]

Lord Marylebone said:

I have a meeting with my accountant in a couple of weeks, during which I will certainly be discussing IR35 with him.

But in the meantime, what does anyone think may happen in my situation?

I’m a property/housing consultant working as a limited company.

My clients are mostly housing associations, councils, and housing providers.

I work on short term projects for numerous different clients. My work for each client can last anywhere from one or two days, to 12 months.

Like any consultant, I get called into places when they lack the expertise or manpower to complete a particular task, or have a problem they cannot solve on their own.

I usually work with 2 or 3 different clients at any one time. 2 days per week with one, 2 days a week with a different one and so on.

Thanks

I used to be the FD for a Housing Association and I’m just wondering what type of role you’re carrying out. We used to have Consultants (ex NHF or RSH types) who would come in, provide advice on stuff such as IDAs, make sure our policies/procedures were up to scratch and that we would be rated G1/V1. Fixed price/ Fixed Scope usually done within 3 months max, onsite maybe 2 days a month. Definitely outside IR35

The other types we employed were effectively Interim Managers/Interim Directors who were effectively filling vacancies in between recruitments or covering temp roles when we had new Developments starting/finishing. They were usually part time, they would normally be line managing/directing staff, they would be representing the HA at meetings with the Builders/architects/Planning. The latter role would definitely fall within IR35.

[anonymous-user]

Countdown said:

I used to be the FD for a Housing Association and I’m just wondering what type of role you’re carrying out. We used to have Consultants (ex NHF or RSH types) who would come in, provide advice on stuff such as IDAs, make sure our policies/procedures were up to scratch and that we would be rated G1/V1. Fixed price/ Fixed Scope usually done within 3 months max, onsite maybe 2 days a month. Definitely outside IR35

The other types we employed were effectively Interim Managers/Interim Directors who were effectively filling vacancies in between recruitments or covering temp roles when we had new Developments starting/finishing. They were usually part time, they would normally be line managing/directing staff, they would be representing the HA at meetings with the Builders/architects/Planning. The latter role would definitely fall within IR35.

I usually do several things:

I deliver and project manage development programmes - the HA doesn’t have the staff/skills to deliver it themselves, so I take it from site purchase, through planning and design, to build/delivery.

I ‘sort out’ problems within Compliance and Building Safety. I go in somewhere they are having problems being compliant in gas/electric/asbestos etc and work a couple of days a week until they are compliant. Including writing new policies and procedures for them.

Policy and procedure review. I go and review how they work, then reorganise and rewrite their manuals.

Other random stuff as well. One hired me to fight a flood of ‘disrepair’ claims they were receiving from residents.

[GT03ROB]

worsy said:

GT03ROB said:

Countdown said:

Gad-Westy said:

Out of interest how do people set up when they are working outside of the UK? If payments are made to a UK company, I understand they still fall under IR35 rules. Do people go to the extent of setting up companies in the country they are working in or is there some of other payment structure in place?

There may be some legislation in the foreign country which requires tax to be deducted at source but otherwise it gets taxed as part of the UK Company’s profits. IR35 wouldn’t (couldn’t) apply.

There will be huge variation location to location. In many location operating under the UK company just will not work for all sorts of tax/legal/visa issues. I'm in one of the 'stans & make extensive use of "contractors". They cannot operate their own company. They are therefor employed through umbrella companies. They receive a rate out of which they are responsible for their own income tax wherever that arises, their social taxes are paid by the umbrella company as is the income tax on benefits. They are an employee of the umbrella company & as such can get visas.

Belgium, Switzerland and Germany all have rules for contractors which means no uk ltd allowed and you must use a local brolly.

Exactly why the "we going to FO abroad" are going to be in for a shock. It's not that straightforward. If you are a genuine contractor it will be a lot easier.... but then you will be outside IR35 anyhow. Come to a 'stan you will find its basically umbrella company, UK rates or less, taxes your problem, nothing offset, less benefits than a staffer. And can the positions be filled...you bet.

[Countdown]

Lord Marylebone said:

I usually do several things:

I deliver and project manage development programmes - the HA doesn’t have the staff/skills to deliver it themselves, so I take it from site purchase, through planning and design, to build/delivery.

I ‘sort out’ problems within Compliance and Building Safety. I go in somewhere they are having problems being compliant in gas/electric/asbestos etc and work a couple of days a week until they are compliant. Including writing new policies and procedures for them.

Policy and procedure review. I go and review how they work, then reorganise and rewrite their manuals.

Other random stuff as well. One hired me to fight a flood of ‘disrepair’ claims they were receiving from residents.

Are these quite small HAs that you’re working for (ie < 6000 units)? Most of the above stuff I would expect a reasonably sized HA to have in-house staff to deal with it. For example the last HA I worked for (c 12000 units) had their own legal people, their own development director with a team of staff under her, and so on.....

[anonymous-user]

Countdown said:

Are these quite small HAs that you’re working for (ie < 6000 units)? Most of the above stuff I would expect a reasonably sized HA to have in-house staff to deal with it. For example the last HA I worked for (c 12000 units) had their own legal people, their own development director with a team of staff under her, and so on.....

The biggest one I have worked for so far is 12,000 units. That’s the one where I (and another consultant) have been delivering their development programme.

Their development director left, and their head of development has been off with stress for 12 months.

Prior to all that, their department as a whole has not managed to deliver any notable amount of housing in 4 years or so for numerous reasons. Staff sickness, and a revolving door of people leaving and joining the department. Posts left unfilled for months.

You get the idea.

I also do work for smaller places (2000-5000 units) where they just don’t employ anyone who would develop/deliver new housing.

[craig511]

Hi all,

Does someone have a calculator which would tell me from an employers point of view , the salary i could offer if my overall annual budget was say £100k.

[mondeoman]

craig511 said:

Hi all,

Does someone have a calculator which would tell me from an employers point of view , the salary i could offer if my overall annual budget was say £100k.

How many staff?

[anonymous-user]

mondeoman said:

craig511 said:

Hi all,

Does someone have a calculator which would tell me from an employers point of view , the salary i could offer if my overall annual budget was say £100k.

How many staff?

I’m guessing just the one.

[Countdown]

craig511 said:

Hi all,

Does someone have a calculator which would tell me from an employers point of view , the salary i could offer if my overall annual budget was say £100k.

89k

https://www.incometaxcalculator.org.uk/?ingr=89000...

[Countdown]

Lord Marylebone said:

The biggest one I have worked for so far is 12,000 units. That’s the one where I (and another consultant) have been delivering their development programme.

Their development director left, and their head of development has been off with stress for 12 months.

Prior to all that, their department as a whole has not managed to deliver any notable amount of housing in 4 years or so for numerous reasons. Staff sickness, and a revolving door of people leaving and joining the department. Posts left unfilled for months.

Would the fact that you’re filling in for a permanent post not suggest the role was inside IR35?

[craig511]

Countdown said:

89k

https://www.incometaxcalculator.org.uk/?ingr=89000...

Thank you,

Now, they would also "pay" me holiday pay (28days) and pension contribution. Is there a way to work out what that would then cost from am employers point of view.

[anonymous-user]

Countdown said:

Lord Marylebone said:

The biggest one I have worked for so far is 12,000 units. That’s the one where I (and another consultant) have been delivering their development programme.

Their development director left, and their head of development has been off with stress for 12 months.

Prior to all that, their department as a whole has not managed to deliver any notable amount of housing in 4 years or so for numerous reasons. Staff sickness, and a revolving door of people leaving and joining the department. Posts left unfilled for months.

Would the fact that you’re filling in for a permanent post not suggest the role was inside IR35?

In my head that is debatable... But I understand what you are saying. Even when they had a full complement of staff, they apparently didn't manage to deliver anything, so that's why they called for assistance.

As with all my assignments I can pull the plug whenever I want, so with that one maybe it's best to call it a day, even though I haven't finished.

Bit of a pisser though.

I guess going forward I'll just have to be more picky and chose things are are short, time limited projects.

[Venturist]

Countdown said:

Would the fact that you’re filling in for a permanent post not suggest the role was inside IR35?

As ever, it surely depends on the actual terms and execution.
Step directly into the leaving man’s shoes - yes.
Engaged to supply a suitable person to deliver the same deliverables that his role formerly delivered, using own tools on own schedule; no.

[Countdown]

craig511 said:

Countdown said:

89k

https://www.incometaxcalculator.org.uk/?ingr=89000...

Thank you,

Now, they would also "pay" me holiday pay (28days) and pension contribution. Is there a way to work out what that would then cost from am employers point of view.

I’m not sure I understand. Your salary includes your holiday pay. Are you doing overtime during your annual leave? I think Employers stakeholder pension contribution is 5% so justplay around with the so roughly speaking knock your salary would be 85k

[Countdown]

Venturist said:

As ever, it surely depends on the actual terms and execution.
Step directly into the leaving man’s shoes - yes.
Engaged to supply a suitable person to deliver the same deliverables that his role formerly delivered, using own tools on own schedule; no.

I’m not sure if the substitution clause on its own would be enough. However, ignoring that for a moment, if the role that Lord M describes is whatI think it is, there is no way that the Chief Exec would accept a substitute (Lord M can correct me if I’m wrong on this, but Ive been involved in excruciating Interim Development Managers and the question of substitution wouldn’t arise). A substitute wouldn’t even be able to get into the building due to security. He’s being employed specifically based on his skills and experience.

In our developments we DID employ Consultants (architecture, planning etc) but it was a completely different relationship.