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IR35 Chronicles VIII

This is part eight of our serialisation of an IR35 enquiry. To Access the previous parts please visit our IR35 Chronicles Index.

Following Neil Down's invitation to jointly complete the 'Statement of Working Practices', Graham Hargreaves, Project Manager, had been obliged to notify BIG IT's procurement team.

In turn, they had requested sight of the document for their own examination and opinion. This was no more than Neil had expected but he did have concerns as to whether they would allow the document to be completed and signed off and, if so, how long this would take.

He expressed his concerns to Dee Fender who instructed him to use his best efforts in securing completion of the statement and offered to write to BIG IT if Neil felt that would be of any assistance. Neil thanked her for the offer but for the time being felt it would be better if he dealt with the end client himself as he did not wish to upset the 'apple cart'.

Mr Turpin, HMRC Status Inspector, wasted no time in responding to Dee Fender's proposed offer of a 'Statement of Working Practices' instead of providing a contact name at BIG IT. Whilst he conceded that the document was of some, albeit limited use, he attempted to dismiss its overall credibility and repeated his request for a contact name.

This time, if the details were not forthcoming within thirty days of the date of his correspondence he would simply contact BIG IT himself. Turpin thanked Fender for the agency contact details and said he would write to Opportunity Knocks in due course to request a copy of the agency-BIG IT contract.

He also expressed his thanks for the tax advisor's offer of a future meeting(s) and intimated that this may be necessary depending on the information he was able to gather and responses to his questions. With reference to his previous letter demanding information within fourteen days he explained that this had been an oversight but offered no apology.

Mrs Fender relayed the contents of Turpin's latest offering to Neil via e-mail. She informed Neil that they should now provide a name at BIG IT who could properly vouch for Neil's working practices. Neil responded by advising that whilst Graham Hargreaves was willing to assist it was unlikely that this would extend to answering HMRC questions and, even if he was, BIG IT's procurement team would simply not allow him to.

Fender wrote back to Mr Turpin explaining the uncompromising position her client had been left in. She communicated her concerns that should Turpin seek to extract information from the procurement team this would not reflect a true picture of BSOD Ltd's working practices and therefore there would be little purpose in doing so. Turpin rejected this argument and soon wrote back to Fender, being the efficient man that he prided himself on, informing her that he had gone ahead and made initial contact and would write back to her as soon as he had something positive to report.

Mrs Fender suspected foul play as no copy correspondence, between HMRC and BIG IT, had accompanied Turpin's letter. How then had he contacted the end client? Fender immediately telephoned Turpin who told her that, in the absence of proper contact details being provided, he had simply obtained the relevant telephone number and made initial contact with someone in procurement.

He said that he had explained to the person in procurement that HMRC was reviewing the IR35 position of BSOD's contract with BIG IT and, as part of that process, it was necessary to gather information from the end client. The person had been told that, whilst Turpin hoped their firm would co-operate voluntarily, HMRC did possess information powers that would compel BIG IT to comply.

An infuriated Mrs Fender voiced her dissatisfaction with Turpin's deviousness and accused him of acting unprofessionally, without courtesy and with disregard to the confidentiality of her client’s tax affairs.

Turpin rejected such an accusation and refuted suggestions that the confidentiality of BSOD's tax affairs had been compromised. He had simply explained to BIG IT the reason for his contacting them and had not revealed any further information about BSOD's affairs.

When questioned as to whether or not BIG IT had indicated that they were willing to entertain the Revenue's request, Turpin told Fender that the end client had asked him to put his request in writing. In the meantime, they would be seeking advice and instruction from their own tax department and, if necessary, their own external professional advisors.

When asked for the name of the person Turpin had spoken to, the Status Inspector told her that he could not reveal this due to third party confidentiality which, understandably, further enraged Mrs Fender. Fender terminated the conversation by informing Turpin that she would be considering issuing a complaint to his manager about his behaviour which hardly seemed to register with the man.

Straight after her conversation with Turpin and regaining her composure, Dee Fender telephoned Neil to inform him of recent developments. Although Fender attempted to pacify Neil, he started to feel a little anxiety creeping in.

Mrs Fender asked him to try to ascertain the name of the person Turpin had made contact with, so that she herself could either speak with or write to that same person in an attempt to offer expert advice and protect Neil from any adversity.

After a few days, Neil got back to Mrs Fender to inform her that he had discovered that Turpin had spoken to a Ms Fiona Pilkington, head of the procurement team, and provided her with both a telephone number and e-mail address. The tax advisor sought her client’s permission to contact her, which he duly consented to as it now seemed that the 'apple cart' had received a jolt!

Next week:  Turpin turns up the heat

By Andy Vessey

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