# Revenue revamp of handling I.T. Contractors etc



## s2000 (14 Nov 2006)

Hi there, I am an I.T. contractor, working as a limited company as most IT contractors are. A friend in the same game told me that he has heard of plans by the revenue to change the way IT contractor work, making them no longer limited companies but instead more like Sole Traders. Has anyone any details on this??

Thanks a million,

S


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## Blinder (14 Nov 2006)

I'm an IT contractor too, but I can't see how they can do this.

I didn't become a limited company because revenue required it. I became a Ltd Co. because agencies require it, so that you are not employed by the agency when out on contract. Therefore you can't claim any benefits for the agency for working there.


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## s2000 (14 Nov 2006)

I think the change is more to do with "one man bands" like us acting as a Limited Company. Dunno, we'll wait and see....


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## Blinder (14 Nov 2006)

It would be intersting to find out. 
Maybe they just plan to audit IT contractors so that people in our situation aren't claiming expenses that they shouldn't.
But I don't see how they can tell me that I can't operate as a ltd company anymore.

Where did he get this information or is it just word of mouth?


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## extopia (14 Nov 2006)

If there's anything to this, it's more likely to mean that the revenue may be looking at classifying such contractors as employees rather than self-employed, especially if they are working exclusively for one company. There are already rules about "de-facto employees." Perhaps the revenue will move to strengthen these.


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## liteweight (14 Nov 2006)

extopia said:


> If there's anything to this, it's more likely to mean that the revenue may be looking at classifying such contractors as employees rather than self-employed, especially if they are working exclusively for one company. There are already rules about "de-facto employees." Perhaps the revenue will move to strengthen these.



Any links to read more about this extopia?


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## s2000 (14 Nov 2006)

Hi. I admit that it is word of mouth at the moment...my mates accountant was saying it to him. 

As for expenses... I hardly take anything from the company as expenses....some of my coleagues take a civil service type daily rate for working on site somewhere away from their home every day...even though the site is the same every day. I believe some auditors would not be too happy about that...wonder what the story is with those kind of expenses?


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## ubiquitous (14 Nov 2006)

Rumours have circulated for years that Revenue here are about to adopt the equivalent of the IR35 rules in the UK that attempt to classify contractors as employees even if they trade through limited companies. A google uk search for IR35 or Inland Revenue site search should yield more info about the UK policy.


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## Meathman99 (14 Nov 2006)

I know absolutely nothing about IT.  However, in the construction, forestry and (i think) meat industry a lot of people who were working as sub contractors on C45 payments were in fact employees.   For these industries there are guidelines as to who s an employee and who s a contractor.   As ubiquitous said this may be what the rumours are about.    Might be worth your time to check revenue website for guidelines


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