Contractors: IR35 & general discussion
Discussion
Deep Thought said:
Gazzab said:
bing said:
I thought HRMC said that IF you stayed with existing client and then went inside IR35 they wouldn't chase for any back dated taxes from before April 2021? Or am I getting this wrong?
That’s not what they said. They said they wouldn’t investigate unless they had reason to consider the need to do so !The link says "The only reason HMRC will open an enquiry using information acquired through the off-payroll working rules changes is if there is reason to suspect fraud or criminal behaviour."
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
Gazzab said:
Deep Thought said:
Gazzab said:
bing said:
I thought HRMC said that IF you stayed with existing client and then went inside IR35 they wouldn't chase for any back dated taxes from before April 2021? Or am I getting this wrong?
That’s not what they said. They said they wouldn’t investigate unless they had reason to consider the need to do so !The link says "The only reason HMRC will open an enquiry using information acquired through the off-payroll working rules changes is if there is reason to suspect fraud or criminal behaviour."
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
They can suggest / coerce / worry you in to volunteering to retrospective change your tax status for the last tax year. Potentially they could ask you to provide evidence of your original basis for the outside IR35 determination on which they may decide to investigate further, but they cant just assume you're guilty of fraud and bill you.
Edited by Deep Thought on Tuesday 9th March 21:29
Deep Thought said:
Gazzab said:
Deep Thought said:
Gazzab said:
bing said:
I thought HRMC said that IF you stayed with existing client and then went inside IR35 they wouldn't chase for any back dated taxes from before April 2021? Or am I getting this wrong?
That’s not what they said. They said they wouldn’t investigate unless they had reason to consider the need to do so !The link says "The only reason HMRC will open an enquiry using information acquired through the off-payroll working rules changes is if there is reason to suspect fraud or criminal behaviour."
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
Gazzab said:
Deep Thought said:
Gazzab said:
Deep Thought said:
Gazzab said:
bing said:
I thought HRMC said that IF you stayed with existing client and then went inside IR35 they wouldn't chase for any back dated taxes from before April 2021? Or am I getting this wrong?
That’s not what they said. They said they wouldn’t investigate unless they had reason to consider the need to do so !The link says "The only reason HMRC will open an enquiry using information acquired through the off-payroll working rules changes is if there is reason to suspect fraud or criminal behaviour."
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
Because they cant even bill you as an individual. They have to pursue your limited company. If theres no funds in it, its nigh on impossible for them to recover the tax.
Deep Thought said:
Gazzab said:
Deep Thought said:
Gazzab said:
Deep Thought said:
Gazzab said:
bing said:
I thought HRMC said that IF you stayed with existing client and then went inside IR35 they wouldn't chase for any back dated taxes from before April 2021? Or am I getting this wrong?
That’s not what they said. They said they wouldn’t investigate unless they had reason to consider the need to do so !The link says "The only reason HMRC will open an enquiry using information acquired through the off-payroll working rules changes is if there is reason to suspect fraud or criminal behaviour."
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
Because they cant even bill you as an individual. They have to pursue your limited company. If theres no funds in it, its nigh on impossible for them to recover the tax.
In yesterday's update HMRC said it understood "mistakes could happen" and taxpayers would not face penalties for inaccuracies relating to the off-payroll working rules in the inaugural year of the rule changes.
The taxman said: "If we see that you have made a mistake, we will support you to understand how to apply the off-payroll working rules correctly...we will encourage you to self-correct errors before we consider if we need to intervene further."
But HMRC said it would also challenge "deliberately non-compliant customers" and would in certain cases publish details of defaulters to "encourage them to put their tax affairs in order".
Gazzab said:
Where do you get this information from? Good luck.
In yesterday's update HMRC said it understood "mistakes could happen" and taxpayers would not face penalties for inaccuracies relating to the off-payroll working rules in the inaugural year of the rule changes.
The taxman said: "If we see that you have made a mistake, we will support you to understand how to apply the off-payroll working rules correctly...we will encourage you to self-correct errors before we consider if we need to intervene further."
But HMRC said it would also challenge "deliberately non-compliant customers" and would in certain cases publish details of defaulters to "encourage them to put their tax affairs in order".
https://www.contractorcalculator.co.uk/ir35_taxes_uncollectable_company_has_no_money.aspxIn yesterday's update HMRC said it understood "mistakes could happen" and taxpayers would not face penalties for inaccuracies relating to the off-payroll working rules in the inaugural year of the rule changes.
The taxman said: "If we see that you have made a mistake, we will support you to understand how to apply the off-payroll working rules correctly...we will encourage you to self-correct errors before we consider if we need to intervene further."
But HMRC said it would also challenge "deliberately non-compliant customers" and would in certain cases publish details of defaulters to "encourage them to put their tax affairs in order".
Now wheres your "we suspect you might have lied so please send us thousands of pounds" letters evidence?
Deep Thought said:
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
They can suggest / coerce / worry you in to volunteering to retrospective change your tax status for the last tax year. Potentially they could ask you to provide evidence of your original basis for the outside IR35 determination on which they may decide to investigate further, but they cant just assume you're guilty of fraud and bill you.
I would tend to agree with you that they cannot automatically assume fraud and would likely request further evidence.They can suggest / coerce / worry you in to volunteering to retrospective change your tax status for the last tax year. Potentially they could ask you to provide evidence of your original basis for the outside IR35 determination on which they may decide to investigate further, but they cant just assume you're guilty of fraud and bill you.
However from this point onwards it would be prudent to have specialist legal representation to help you vet and prepare evidence for submission to HMRC. Then you're going to have a back and forth with HMRC for a significant period, and worst case scenario a bill or court case to attend. Whatever happens it's going to be a nerve wracking s
t show.Deep Thought said:
https://www.contractorcalculator.co.uk/ir35_taxes_...
Now wheres your "we suspect you might have lied so please send us thousands of pounds" letters evidence?
That article would strike fear into me if I was moving to an inside contract with the same client. The evidence is your acceptance of such a contract after being self determined outside. Now wheres your "we suspect you might have lied so please send us thousands of pounds" letters evidence?
Gazzab said:
Has anyone said, "lets trust HMRC"?You said that based only on the record of you now being inside, when previously declared outside they could bill you for thousands.
Wheres your evidence of that?
Gazzab said:
They get the records that say a) you always declared yourself outside and b) your client now defines you as inside.
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
You then also said they could take your house and car.We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
Wheres your evidence of this?
Gazzab said:
They may take your house and car.
Olivera said:
Deep Thought said:
They cant simply "assume" or "suspect" you have not been honest in your ways and give you a bill.
They can suggest / coerce / worry you in to volunteering to retrospective change your tax status for the last tax year. Potentially they could ask you to provide evidence of your original basis for the outside IR35 determination on which they may decide to investigate further, but they cant just assume you're guilty of fraud and bill you.
I would tend to agree with you that they cannot automatically assume fraud and would likely request further evidence.They can suggest / coerce / worry you in to volunteering to retrospective change your tax status for the last tax year. Potentially they could ask you to provide evidence of your original basis for the outside IR35 determination on which they may decide to investigate further, but they cant just assume you're guilty of fraud and bill you.
However from this point onwards it would be prudent to have specialist legal representation to help you vet and prepare evidence for submission to HMRC. Then you're going to have a back and forth with HMRC for a significant period, and worst case scenario a bill or court case to attend. Whatever happens it's going to be a nerve wracking s
t show.I havent said otherwise.
I am merely disputing what Gazzab said here.
Gazzab said:
They get the records that say a) you always declared yourself outside and b) your client now defines you as inside.
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
Deep Thought said:
Gazzab said:
Has anyone said, "lets trust HMRC"?You said that based only on the record of you now being inside, when previously declared outside they could bill you for thousands.
Wheres your evidence of that?
Gazzab said:
They get the records that say a) you always declared yourself outside and b) your client now defines you as inside.
We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
You then also said they could take your house and car.We suspect you have previously not been honest about your ways or working and so we suspect fraud. Here’s a letter. Here’s a calc re what you owe us. Pay up or we’ll see you in court.
Wheres your evidence of this?
Gazzab said:
They may take your house and car.
How will you pay the tax bill - might mean selling assets.
Gazzab said:
Deep Thought said:
https://www.contractorcalculator.co.uk/ir35_taxes_...
Now wheres your "we suspect you might have lied so please send us thousands of pounds" letters evidence?
That article would strike fear into me if I was moving to an inside contract with the same client. The evidence is your acceptance of such a contract after being self determined outside. Now wheres your "we suspect you might have lied so please send us thousands of pounds" letters evidence?
And noone has said otherwise. I wouldnt trust HMRC at all, however there is due process to follow and they have to pursue the ltd co, not the individual.
Gazzab said:
What are you talking about. The question is can they come after you for previous invalid outside self determination. Yes.
How will you pay the tax bill - might mean selling assets.
No.How will you pay the tax bill - might mean selling assets.
Wrong on both accounts.
They come after the limited company.
They cant take or force you to sell your home and car (except in very very limited circumstances).
Invalid <> fradulent.
So wheres your evidence to back up what you have said?
Deep Thought said:
Gazzab said:
What are you talking about. The question is can they come after you for previous invalid outside self determination. Yes.
How will you pay the tax bill - might mean selling assets.
No.How will you pay the tax bill - might mean selling assets.
Wrong on both accounts.
They come after the limited company.
They cant take or force you to sell your home and car (except in very very limited circumstances).
So wheres your evidence to back up what you have said?
Deep Thought said:
however there is due process to follow and they have to pursue the ltd co, not the individual.
My understanding is that they do have the power to pursue the directors of a company personally under certain circumstances, and those circumstances include unpaid taxes. Specifically PAYE.sources:
https://www.aabrs.com/can-hmrc-hold-a-director-res...
https://www.companydebt.com/hmrc-tax-problems/can-...
https://bambury.info/business-tax/can-hmrc-hold-a-...
https://www.brettsbr.co.uk/hmrc-and-powers-to-purs...
Clockwork Cupcake said:
Deep Thought said:
however there is due process to follow and they have to pursue the ltd co, not the individual.
My understanding is that they do have the power to pursue the directors of a company personally under certain circumstances, and those circumstances include unpaid taxes. Specifically PAYE.sources:
https://www.aabrs.com/can-hmrc-hold-a-director-res...
https://www.companydebt.com/hmrc-tax-problems/can-...
https://bambury.info/business-tax/can-hmrc-hold-a-...
https://www.brettsbr.co.uk/hmrc-and-powers-to-purs...
This is whats pertinent to IR35.
https://www.contractorcalculator.co.uk/ir35_taxes_...
The exception would be if they tried to invoke Regulation 72.
Gazzab said:
Deep Thought said:
Gazzab said:
What are you talking about. The question is can they come after you for previous invalid outside self determination. Yes.
How will you pay the tax bill - might mean selling assets.
No.How will you pay the tax bill - might mean selling assets.
Wrong on both accounts.
They come after the limited company.
They cant take or force you to sell your home and car (except in very very limited circumstances).
So wheres your evidence to back up what you have said?
It is absolutely not a case of - we've had sight of your determination from the client, you determined yourself outside previously, we think you're a fraud, send us thousands of pounds or we'll take your house and car.
Edited by Deep Thought on Tuesday 9th March 22:18
Gazzab said:
Deep Thought said:
You said it, you back it up.
Just Google. ‘Sell my house to pay tax Bill’. There are, for example, many loan charge ‘victims’ who have sold their house to pay their tax bill. How many times have you to be told this?
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