Why would vat make a difference to compilence vat is what they usually use to highlight of you lr just a driver or not. It comes down to have clients and the company must be run towards making a profit
F-reds:
I’m no specialist when it comes to employment status, the way some of guys describe your umbrella pay packets makes my head spin. But I can read, and I think the whole second half of that article is confusing in the extreme.It’s sets out four points you should be able to satisfy if you are self employed. The trouble is these points are how the earlier referred to franchised tipper O/D get around the only having one client loophole.
We all know that the people HMRC are looking at the guys who have set as “Mikes’s Driver Services” as self employed, and go and work for one haulier exclusively driving their trucks week in week out. As such they can’t satisfy the four points. But if they worked for more than one haulier per tax year in this manner, is that not fair play under the guise of being self employed■■?
Working for more than one firm does not necessarily mean that any, or all, of those arrangements are on a self-employed basis. A person can be employed as well as running a business, a person can have multiple part-time employments, and a person can be employed casually.
Also, a small business may well have a single client for a significant period of time - no sensible businessman is going to serve more clients than he actually needs to in order to exhaust his own capacity. A plumber is not going to do a half-day each for two customers, if one customer will hire him for the whole day.
Neither businesses nor employments take any consistent form, although people have a surprisingly good intuition of the difference. The easiest way to tell the difference is just look at the people you work with and what they do, and ask yourself whether you perceive them (and would describe them) as businessmen.
Also ask yourself, what is it about your character and motivation that sets you apart from an employee in the same occupation? What do you do differently, and what is your market offering? If it is purely the evasion of PAYE taxes, that is unlikely to make you a businessman.
Of course, HMRC have to prove what the arrangements actually are, and the accountants are probably correct that the best way to avoid undue attention to those arrangements is to make sure your paperwork is in order.
I read this when i got my copy through the post.
Drivers are near the bottom of the disguised employment list.
I.T is way ahead of us.
The best part of it is, some companys ONLY employ people as s/e /ltd
Alot of the problem it that transport is too cheep or many bosses cream to much off the top so end up looking for ways to cut costs the easiest is to drop the wage or put it as a cost ie take se I know a few firms who only take se and have for many many years done so
More scaremongering from the (not fit for purpose) HMRC. HMRC have had the IR35 Legislation at their finger tips since 2000, the same criteria apply to that Legislation as to this disguised employment that they are blabbering on about. HMRC gain a lot of advice from reading these forums, although sorting the facts from the fiction will take them forever.
robbo99:
More scaremongering from the (not fit for purpose) HMRC. HMRC have had the IR35 Legislation at their finger tips since 2000, the same criteria apply to that Legislation as to this disguised employment that they are blabbering on about. HMRC gain a lot of advice from reading these forums, although sorting the facts from the fiction will take them forever.
I was more into IT than driving in 2000 and the industry board was full of knobbers like you saying the same thing. Not long later the boards were full of knobbers like you crying about the tax bills they’d got.
Believe you’re right if it helps you sleep at night but I’ve been through this before in the IT sector and it wasn’t pretty.
Like Conor, I was also in IT when IR35 came in, and saw how it operates. Basically, if you rock up at a transport company and drive their truck where they tell you, using their diesel, o-licence etc in return for payment, you ain’t self-employed - you’re a deemed employee and you’ll get taxed and ni’ed accordingly, even if you work for a different company every day. Its the individual jobs that they work on, not your setup as a while.
scaniason:
Like Conor, I was also in IT when IR35 came in, and saw how it operates. Basically, if you rock up at a transport company and drive their truck where they tell you, using their diesel, o-licence etc in return for payment, you ain’t self-employed - you’re a deemed employee and you’ll get taxed and ni’ed accordingly, even if you work for a different company every day. Its the individual jobs that they work on, not your setup as a while.
But, if you use your own phone [bill paid via LTD bank a/c] to liaise with the office, and you are left to get on with it, using your own digi card, DCPC card, PPE, maps/prattnav, knowledge/noggin, you are deemed to be ■■?
According to my accountants, if you pay PAYE / Corporation Tax / Dividend tax / VAT ect., you will not have a problem, just keep the claims to a realistic level, no ■■■■ taking and keep your nose clean 
Ive got a builder due here any time soon, Im providing all the materials, he is labour only, I`ll ask him how he manages to get around it 
Stanley Mitchell:
scaniason:
Like Conor, I was also in IT when IR35 came in, and saw how it operates. Basically, if you rock up at a transport company and drive their truck where they tell you, using their diesel, o-licence etc in return for payment, you ain’t self-employed - you’re a deemed employee and you’ll get taxed and ni’ed accordingly, even if you work for a different company every day. Its the individual jobs that they work on, not your setup as a while.But, if you use your own phone [bill paid via LTD bank a/c] to liaise with the office, and you are left to get on with it, using your own digi card, DCPC card, PPE, maps/prattnav, knowledge/noggin, you are deemed to be ■■?
According to my accountants, if you pay PAYE / Corporation Tax / Dividend tax / VAT ect., you will not have a problem, just keep the claims to a realistic level, no ■■■■ taking and keep your nose clean
I
ve got a builder due here any time soon, Im providing all the materials, he is labour only, I`ll ask him how he manages to get around it
To many drivers caim to much and not check what accountant sent him by email.If HMRC check drivers paperwork about expences that every second drivers get penalty and extra bill about millage and more.
I have been set up as a LTD company for 2 years now. I have a full time job outside of the driving sector for which I am PAYE.
I set up a LTD company when I passed my class 1 and carry out ad hoc work directly for 3 small hauliers and through 2 different agencies. I cover weekends and weekdays when my other employment allows it. I don’t use an umbrella scheme or an agency accountant, I use an independant accountant who has sorted both my company and personal tax liability since I started.
If I was driving full time, I would probably prefer to be directly employed. However, this is the most flexible way to oeprate for me as I can contact multiple firms on theThursday and confirm who requires a driver for any weekend work. If they cancel, c’est la vie they owe me nothing (unless it’s on the day)…if I’m not available then I just don’t contact them and they know not to plan me any work. If they’re desperate, they ring. Everybody is happy and I am not employed by any of them, they use a service I am (barely) qualified to provide.
I stand to be corrected when I get hit with a tax bill but everything I do is above board and if HMRC had an issue, surely they would of spotted it on my personal tax return.
We’ll see!!
With all the posts on here going on about big tax bills and budget changes to expense claims etc, im a bit confused.
If someone is actually fully and properly self employed and set up as either a sole trader or their own ltd company, is this not perfectly ok provided they are set up right for tax purposes? Is the main problem not just the ones who are in an umbrella company? Is this not the ones hmrc are going after?
The multiple customer angle is a sticky wicket for most. The lack of understanding of some, sums it up really. They think by working for Tesco most of the year, with a few shifts for Sainsburys sprinkled in, is enough to satisfy the criteria. When in fact, they’re not your customer. The agency is the customer. So really, you need to work most of the year for limpers resource ltd, with the odd day for lidl bag staffing thrown in the mix
Right lets get one or two things straight. A driver unless an OD would find it very difficult to prove self employed status. Some of the other criteria HMRC use to determine status are…
The S/E person must provide the principal tools of their trade. In this case its the truck.
There can be no master/servant relationship. I.e its up to S/E person to decide how and when a job gets done. e.g a builder will choose the days he wants to do the job but if he has another job on its up to him to juggle them. A driver will go where he is told and when.
The S/E person can substitute an equally qualified person to undertake the task.
There must be an element of risk. i.e. a builder will price a job at a fixed rate if it takes him longer than anticipated he makes a loss (or less profit). Hourly pay does not fall into this category.
HMRC have been trying to close the IR35 loophole since I worked there. That was, as has been mentioned, designed for service contracts.
I have been saying all this for quite some years…
OVLOV JAY:
The multiple customer angle is a sticky wicket for most. The lack of understanding of some, sums it up really. They think by working for Tesco most of the year, with a few shifts for Sainsburys sprinkled in, is enough to satisfy the criteria. When in fact, they’re not your customer. The agency is the customer. So really, you need to work most of the year for limpers resource ltd, with the odd day for lidl bag staffing thrown in the mix
And how does this cunning plan actually stop both jobs being treated as two separate employments (rather than one business)?
Because the supplier of the work the agency is your customer not tesco or Sainsbury’s ( shop names used for illustration purposes only)
they will end up with a scheme similar to construction - at the end of the day its no different to several of my mates who as a sparky work for a company on a rate use the companys vans yet they are self employed■■? its no different other than they have a few tools - if that’s the case all a driver need to do is put a few spanners in his bag and hey ho its the same principle!
Nessa:
Right lets get one or two things straight. A driver unless an OD would find it very difficult to prove self employed status. Some of the other criteria HMRC use to determine status are…The S/E person must provide the principal tools of their trade. In this case its the truck.
There can be no master/servant relationship. I.e its up to S/E person to decide how and when a job gets done. e.g a builder will choose the days he wants to do the job but if he has another job on its up to him to juggle them. A driver will go where he is told and when.
The S/E person can substitute an equally qualified person to undertake the task.
There must be an element of risk. i.e. a builder will price a job at a fixed rate if it takes him longer than anticipated he makes a loss (or less profit). Hourly pay does not fall into this category.HMRC have been trying to close the IR35 loophole since I worked there. That was, as has been mentioned, designed for service contracts.
I have been saying all this for quite some years…
Any builder picking and choosing his days will be sidelined by “Pawel The Builder” in no time at all, my limping lidl bag carrying brickie is down to do a job, which WILL take a day, none of this “I`ll be back tomorrow” bollox 
Pawel is not paying any tax, although his van is carrying his name and number, because they are using very dodgy s/e tax status to keep one step ahead of HMRC 
ops
Nessa:
Right lets get one or two things straight. A driver unless an OD would find it very difficult to prove self employed status. Some of the other criteria HMRC use to determine status are…The S/E person must provide the principal tools of their trade. In this case its the truck.
There can be no master/servant relationship. I.e its up to S/E person to decide how and when a job gets done. e.g a builder will choose the days he wants to do the job but if he has another job on its up to him to juggle them. A driver will go where he is told and when.
The S/E person can substitute an equally qualified person to undertake the task.
There must be an element of risk. i.e. a builder will price a job at a fixed rate if it takes him longer than anticipated he makes a loss (or less profit). Hourly pay does not fall into this category.HMRC have been trying to close the IR35 loophole since I worked there. That was, as has been mentioned, designed for service contracts.
I have been saying all this for quite some years…
And then where it all becomes confused is that there seem to be counter-examples for each point.
Is a s/e plumber with a spanner (his tools), who works on the customer’s equipment (say a large pump or an industrial boiler), different from a driver with a bag and a glove (his tools), who works on the customer’s equipment (the wagon)?
If you tell a builder whose building you an extension at home that you want him there for a specific time or specific day, do you suddenly become his employer? Liable for PAYE? What if you give him a blueprint for the work - does he have any real control or freedom left?
Can a renowned artist or performer you engage, really send any other Tom, ■■■■, or Harry in instead? And if not, then are you suddenly their employer?
And if the builder cannot estimate the job’s length, and so charges you a daily rate, again does he suddenly become your employee?
To tie all this together, if you engage a bricklayer to build a wall at home, and he provides minor tools like a trowel but nothing substantial (and he uses your garden shovel to mix the mortar, and he doesn’t clear any waste left over), and you refuse to accept substitution (because you know the quality of his work), and you expect him to keep the arranged schedule, and you pay him by the day, is he employed or self-employed? Our intuition is still to consider him self-employed.
But if a commercial housebuilder engages a workman to do a day’s work (under similar sorts of conditions), then he seems to be employed.
The fundamental difference is the power and status inequality (captured in the notion of “master and servant”). A man who is a servant at the local manor, is not a servant in his own home. And a builder who is an employee when on a site governed by a commercial housebuilder, is not an employee on a site governed by a domestic householder. But a domestic servant is an employee of a domestic householder. We know intuitively that a builder’s typical relationship to a householder is very different from a domestic servant’s typical relationship to a householder. Unless, of course, a householder needs brick laying as often as their clothes washing, and then maybe they become more like an employer of the builder.
but this is my point at present all the ‘authorities’ bang on about the huge driver shortage - and your really going to tell me that they will not bend to a similar scheme as the construction one given if say 1 in 10 left the industry (and no we wont have turks to replace). I reckon they will get rid of all the umbrella schemes but leave the ltd driver alone as long as they work at more then one firm.
Rjan:
Nessa:
Right lets get one or two things straight. A driver unless an OD would find it very difficult to prove self employed status. Some of the other criteria HMRC use to determine status are…The S/E person must provide the principal tools of their trade. In this case its the truck.
There can be no master/servant relationship. I.e its up to S/E person to decide how and when a job gets done. e.g a builder will choose the days he wants to do the job but if he has another job on its up to him to juggle them. A driver will go where he is told and when.
The S/E person can substitute an equally qualified person to undertake the task.
There must be an element of risk. i.e. a builder will price a job at a fixed rate if it takes him longer than anticipated he makes a loss (or less profit). Hourly pay does not fall into this category.HMRC have been trying to close the IR35 loophole since I worked there. That was, as has been mentioned, designed for service contracts.
I have been saying all this for quite some years…
And then where it all becomes confused is that there seem to be counter-examples for each point.
Is a s/e plumber with a spanner (his tools), who works on the customer’s equipment (say a large pump or an industrial boiler), different from a driver with a bag and a glove (his tools), who works on the customer’s equipment (the wagon)?
If you tell a builder whose building you an extension at home that you want him there for a specific time or specific day, do you suddenly become his employer? Liable for PAYE? What if you give him a blueprint for the work - does he have any real control or freedom left?
Can a renowned artist or performer you engage, really send any other Tom, ■■■■, or Harry in instead? And if not, then are you suddenly their employer?
And if the builder cannot estimate the job’s length, and so charges you a daily rate, again does he suddenly become your employee?
To tie all this together, if you engage a bricklayer to build a wall at home, and he provides minor tools like a trowel but nothing substantial (and he uses your garden shovel to mix the mortar, and he doesn’t clear any waste left over), and you refuse to accept substitution (because you know the quality of his work), and you expect him to keep the arranged schedule, and you pay him by the day, is he employed or self-employed? Our intuition is still to consider him self-employed.
But if a commercial housebuilder engages a workman to do a day’s work (under similar sorts of conditions), then he seems to be employed.
The fundamental difference is the power and status inequality (captured in the notion of “master and servant”). A man who is a servant at the local manor, is not a servant in his own home. And a builder who is an employee when on a site governed by a commercial housebuilder, is not an employee on a site governed by a domestic householder. But a domestic servant is an employee of a domestic householder. We know intuitively that a builder’s typical relationship to a householder is very different from a domestic servant’s typical relationship to a householder. Unless, of course, a householder needs brick laying as often as their clothes washing, and then maybe they become more like an employer of the builder.
You have principally used a jobbing builder or construction tradesman for your examples of employment or self employment which is not a relevant comparison as the construction industry falls into its own particular scheme and as such even a jobbing builder would meet the relevant criteria by the nature that not all employers (as in people who contract him to do the work) would expect nor demand the strict rules you have imposed on him. Under the construction industry scheme were he to work for a contractor he would be subject to tax at 30% if his UTR could not be verified, 20% if it was verified but he had less than 3 yrs accounts verified by HMRC and only net of tax if he fulfilled all their criteria.
So were we to consider a scheme along the CIS lines tax would still be deducted from most s/e or Ltd companies at a higher rate than if they were employed for at least the first three years.
The terms I have quoted by the way are taken directly from a HMRC instruction manual on status.