ExDubai,
It is not a theory. A couple of years ago I hired a very well respected Law firm to find out what the legislation is regarding pilots whi are " self employed".
I suggest anyone who is in a situation where Tax predators want your skin do the same and attack the taxman if they want your hard earned money.
Contractors are victims, not criminals. And it is typical for the spineless Pilot community to side with those wanting to hurt our colleagues.