Re: PSC no longer a loophole
The problem with this is as, someone who employs contractors it ignores the reason why I do it.
The main reason is flexibiity in the number of developers. When things are going well we try to have 10%-15% contratcors when things are not going so well they are all dropped. We have never made an employee redundant but we have often got rid of contractors even to the point where we have none at all.
The second reason is for a limited short duration project where it is known from the start that once that work is done the contract will be over.
I don't know where your claim that only 10% of PSCs are steup correctly come from. I know that we have never engaged a contractor as a disguised form of employment. We did it fundamentally so we can get rid of them whenever we need to without significant, time, cost and damage to the morale of permenant employees who know we will shield them from short term ups and downs.
What is interesting is when I use the HMRCs tool does not ask any questions about whether we would get rid of the contractors if we have a down term whereas to me it is the prime distinguishing factor between them and employees. As a small business we can make an assessment that IR35 does not apply but large businesses are very risk averse and the legal and HR departments who probably make this decision know nothing about the reality of why contractors are engaged so it is completely understandable they take the least risk apporoach. No one will be sacked for judging all contractors are inside IR35 whereas someone would be sacked for a claim from the HMRC even if the HMRC was wrong. The cost and effort of fighting the HMRC would probably itself be judged as too risky.
Biting the hand that feeds IT
