IfA Now have a policy on Self Employment

[BAJR]

Exactly.

And there is much spurious stuff about self employed. Half truths, real truths and almost truths.

At the end of the day I work for clients, who often have their own timescales, so I must work within the main contract. no point me saying, will see you next thursday and then not turn up I would soon find myself quite hungry! I also decide with my client what I will do for them, how much it will cost etc... sometimes I work to a fixed cost - ie, if I finish the job faster, then I take a bonus, if I am slower, I take a hit.! - Sometimes I work for a day rate, based on how fast the client can work. ie - A services trench will take as long to evaluate as it takes the machine operator to dig it. if they take 3 days... fine... I get paid three days.

I also have insurance for various works, covering me for volunteers, members of teh public and myself. Sometimes I don't need that, as I come under the main contractor, sometimes I do. SOmetimes the contractor will provide tools, but mainly I am expected to turn up with all the equipment I need to carry out my work (when was the last time you saw a carpenter saying " I can't do the job as the client did not give me a hammer??)

It is a contract between you and the client. you decide your terms and your cost. when teh cleint starts dictating times, rates, conditions etc..then provides all your tools, from drawing boards to nails and shovels. then you have to ask? Am I self Employed? Do I have what it takes to be self employed? or am I a labour only contractor. Which can look the same?

But read this article from 2009

There have been many failed attempts to move workers from CIS into PAYE. All contractors have had inspection visits, letters, and threats. Many have moved workers into PAYE and paid penalties and arrears of PAYE only to find that within months, they have to use self-employed workers again if they are to stay competitive.

In July, HMRC announced its intention to attack bogus selfemployment again – but this time it will do it with legislation. HMRC proposes a piece of new law, which will mean:

All money actually paid for construction work must be taxed under PAYE unless:

• The worker provided all the materials for the job, or
  
• The worker provided all the plant and equipment over and above normal tools of the trade, or
  
• The worker brought other workers who he paid himself.
  

There are some interesting things to think about here. PAYE would be compulsory for anyone paying a labour-only subcontractor. It’s like a default option on a computer – PAYE is essential and unavoidable unless the person paying a subcontractor is certain he is supplying materials, plant or other workers.

WHOSE RESPONSIBILITY?
The requirement to deduct PAYE is on the person paying the money – so if workers come via any agency, intermediary, umbrella company etc – it is that business that must operate PAYE.

And note carefully, the legislation does not make anyone an employee – it simply puts pay packets into PAYE. There is the same flexibility to have a casual workforce – it is just that Class 1 NICs must be paid.

There is no start date for the legislation yet – so with luck the industry will start having to operate it from an agreed future date and the playing field will be fair.

SO WHAT SHOULD MEMBERS OF THE FMB DO?
Before you jump for the ‘Tell them to Buzz Off’ option, just think. The Consultation estimates that there are 300,000 labour-only subcontractors in the UK who never supply materials and only take home one man’s pay packet – they are not paying others. The loss of tax and NIC to the Chancellor is estimated at ?350,000,000. Ask yourself if he will willingly ignore such a loss of tax?

The Consultation listed the previous attempts that HMRC made to get us all onto the straight and narrow:

• The 1997 amnesty
  
• The 2004/5 extra compliance activity
  
• The 2004/5 and 2005/6 waves of targeted letters
  
• The 2006/7/8 development of the ESI tool on the Internet
  
• The 2007 new CIS returns with declarations and penalties. What a list!
  

The sensible response is to work with HMRC to make the new legislation work so that only labour-only subcontractors go into PAYE – and not genuine traders who are in business on their own account and take risks that go well beyond the fact that they won’t be paid if it snows.

http://www.fmb.org.uk/information-and-he...d58=141596