Reply to post: Letter or email to MP

IT contractors raise alarm over HMRC mulling 'one-month' nudge onto payrolls

Anonymous Coward
Anonymous Coward

Letter or email to MP

This is my version of the I P S E boiler plate letter.

Home address MUST be quoted or letter / email will be ignored.

MP can be found based on post code here:

http://www.parliament.uk/mps-lords-and-offices/mps/

Email addresses are given usually, but not always; a parliament address and a "private" address.

Edit paragraph 2 to match your circumstances.

Add your home address here.

Name of MP here MP

House of Commons

London SW1A 0AA

22 November 2015

Dear Sir,

I am very concerned by articles in the Guardian and the Daily Mail on an expected “crackdown” (read witch hunt) on some of the smallest business in the UK – limited company “contractors”. According to the reports are proposed a one month time limit on engagements will be introduced, after which independent professionals like me, running their own properly regulated limited company, being essentially self employed with limited liability (as designed by parliament to encourage business risk taking) , will be forced onto the p.a.y.e. payroll of the client. This would completely undermine commercial relationships and would jeopardise the survival of mine and thousands of other similar businesses. In fact it would put us all out of business. Many would face bankruptcy owing to the sudden massive halt in expected business performance.

My company supplies through me specialist project management, risk and issue management, project delivery skills to clients across a range of industries including banking, HMRC, commerce and always world class enterprises. You will note the irony of HMRC in my list, if they do this, they will risk losing the ability to operate because of the vast number of workers like myself upon whom they rely in order to function. I suspect they have not thought of this, one hand not knowing what the other is doing.

If reports of a one month limit are true it will make running my business impossible as, overwhelmingly, the projects I work on last considerably longer than this. Clients will not want to put me on their payroll and I do not want to be there. I am an external specialist, working for my self within my legally UK registered limited company. It makes no sense to treat me like an employee of the client when neither they, me or any matching agencies want it. It is very well and long known that the independent mentality of the truly self-employed renders them essentially “unemployable” after very little time in charge of their own destiny. HMRC cannot force human nature to be something it is not and our country’s commercial foundation rests on the small business community of which we form part.

It would also raise the issue of employment rights. I do not want entitlements such as holiday pay, sick pay, auto-enrolment for pension contributions and the right to bring a claim for unfair dismissal. As a director of my own company, I have chosen to sacrifice those rights in return for the potential of managing my own destiny. However, if I am to be taxed like an employee then I will expect employee benefits which will make engaging my business unattractive to clients. This measure would completely wipe out the flexible advantage that freelance specialists like me offer to the likes of HMRC (ironically), the financial services industry (e.g. The City, London), the banks and other world class enterprise businesses that engage the likes of myself.

I run an entirely legitimate UK registered company as defined in UK law, which fully meets all its obligations including taxes. I strongly resent the continued implication from this Government that small businesses like mine are avoiding tax (itself a word only recently turned on its head), which is essentially based on the falsity that in truth we are “disguised employees”. We are not. Decades ago HMRC had a perfectly effective set of case law well placed and used to separate out those who were in truth employees on Friday and claiming by the following Monday to be self-employed. I refer of course to the traditional “status enquiry”, which law still exists and works, but is no longer used, in preference to complex draconian rules made up to try to circumvent HMRC’s own case law.

HMRC has sought to make life easy for itself, is obsessed with “disguised employment” and in turn wreaks inestimable damage to its reputation and the desire of anyone to co-operate with it because it keeps trying to change the rules it already has and had to suit itself. Witness the start of it all decades ago when HMRC forced all such as myself to engage the use of limited companies. We were perfectly happy to defend our status as “self-employed” and accepted the outcomes in those days. This is no longer the case and it has become a political football founded in the HMRC obsession to the detriment of everyone, the country in particular.

In the UK we are entitled to a certain business environment and not to have to fear what is coming next in every Autumn statement. Enough is enough. We are not the enemy and stop treating us as if we are, please.

I urge you to inform the Chancellor ahead of the Autumn Statement and to confirm whether these reports are accurate and, if they are, ask that you reverse course on this extensively damaging proposal.

Yours faithfully,

Your name here

A concerned constituent

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