• Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
  • Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!

Outside to Inside IR35 - Same Client, Different Agent, Different Contract

Collapse
X
  •  
  • Filter
  • Time
  • Show
Clear All
new posts

    Outside to Inside IR35 - Same Client, Different Agent, Different Contract

    Hi All,

    Long time lurker, first time poster (please be gentle)..

    I just wanted your good people’s thoughts on my particular situation with regard to this whole public sector debacle (I was going to post in the Staying In Public Sector thread - but thought I'd start a new one as that is getting quite weighty..)

    I’ve just finished the first contract (6 months) at a public sector body. The contract was a Capita CL1 one, which I had run as being outside IR35 (yes, yes I know - but it has a substitution clause, etc. and I had both the contract and working practices document signed off by the client and approved by QDOS as being outside IR35).

    I also have spent the last couple of months of this contract away on (effective) holiday, so the last invoice on this contract has already been paid in January - so no payments post April.

    I have an offer of an extension - which has been deemed inside IR35 by the client in this brave new world. Fair enough.

    I originally thought this would be a straight extension of my current contract. Given that would mean a straight switch from outside to inside - and a potential red flag to HMRC - I had intended to retrospectively change my current contract accounts from outside to inside IR35 to avoid any unnecessary unpleasantness (my accountant said they should be able to do this - sort out all the taxes, etc).

    However, I’ve now found out the client is also switching agencies (and presumably contracts). So this ‘extension’ would actually be a new contract with a totally new agent. There will also be a gap of several weeks between the old contract ending and the new one starting (not to mention I haven’t actually worked the last 2 months of my old contract).

    So I was just thinking I was maybe being too cautious trying to retro-fit my old contract accounts into being inside IR35 - and in this case I can just accept the old contract as being outside, and the new contract as being inside IR35 and carry on.

    Appreciate no-one really knows how HMRC will deal with these situations - and it all comes down to ‘how well you want to sleep at night’, but I’m thinking this gives me a *fair* degree of confidence that the old contract is well enough covered to cause HMRC to pass over if it ever arose (and yes, I have IR35 insurance).

    Thought it might be useful to throw this particular scenario into the mix and see if anyone had any (hopefully constructive) insights?…

    Thanks for your time
    This, Jen, is the Internet.

    #2
    Originally posted by Moss View Post
    Hi All,

    Long time lurker, first time poster (please be gentle)..

    I just wanted your good people’s thoughts on my particular situation with regard to this whole public sector debacle (I was going to post in the Staying In Public Sector thread - but thought I'd start a new one as that is getting quite weighty..)

    I’ve just finished the first contract (6 months) at a public sector body. The contract was a Capita CL1 one, which I had run as being outside IR35 (yes, yes I know - but it has a substitution clause, etc. and I had both the contract and working practices document signed off by the client and approved by QDOS as being outside IR35).

    I also have spent the last couple of months of this contract away on (effective) holiday, so the last invoice on this contract has already been paid in January - so no payments post April.

    I have an offer of an extension - which has been deemed inside IR35 by the client in this brave new world. Fair enough.

    I originally thought this would be a straight extension of my current contract. Given that would mean a straight switch from outside to inside - and a potential red flag to HMRC - I had intended to retrospectively change my current contract accounts from outside to inside IR35 to avoid any unnecessary unpleasantness (my accountant said they should be able to do this - sort out all the taxes, etc).

    However, I’ve now found out the client is also switching agencies (and presumably contracts). So this ‘extension’ would actually be a new contract with a totally new agent. There will also be a gap of several weeks between the old contract ending and the new one starting (not to mention I haven’t actually worked the last 2 months of my old contract).

    So I was just thinking I was maybe being too cautious trying to retro-fit my old contract accounts into being inside IR35 - and in this case I can just accept the old contract as being outside, and the new contract as being inside IR35 and carry on.

    Appreciate no-one really knows how HMRC will deal with these situations - and it all comes down to ‘how well you want to sleep at night’, but I’m thinking this gives me a *fair* degree of confidence that the old contract is well enough covered to cause HMRC to pass over if it ever arose (and yes, I have IR35 insurance).

    Thought it might be useful to throw this particular scenario into the mix and see if anyone had any (hopefully constructive) insights?…

    Thanks for your time
    Practically speaking? How about closing down your Ltd and going with a brolly, and keep your IR35 insurance going (if this is possible).

    Comment


      #3
      Originally posted by northernladyuk View Post
      Practically speaking? How about closing down your Ltd and going with a brolly, and keep your IR35 insurance going (if this is possible).
      Hi - thanks for your suggestion. I'm still undecided about whether to use a brolly or stick with my limited (my accountant runs a PAYE scheme for me). I've never operated inside IR35 before so it's a bit of a learning curve.

      If I did go brolly, closing down the company seems a bit extreme - I've operated it for nearly 10 years now, and once this contract ends (it will likely extend for another year or more, but then again, who knows for sure) I may be back on an outside IR35 role again.
      This, Jen, is the Internet.

      Comment


        #4
        I am in a similar position. My contract that started in October ends on Friday with final payment due on April 7th (bugger). So a decision has to be made whether this final week is inside or outside IR35 and unfortunately the decision makers are coming down in favour of inside. My strategy is to persuade them that I am only looking for outside status for this one week and then the contract ends.

        As I am on holiday next week and the client has said they want me back for another project, my thinking is that we draw up a new contract next week with the agent and if they deem the new contract inside IR35 then I up my day rate. Basically I give them two day rates, my current rate if outside IR35 and a higher rate for inside.

        Andrew

        Comment


          #5
          Originally posted by Scotchpie View Post
          I am in a similar position. My contract that started in October ends on Friday with final payment due on April 7th (bugger). So a decision has to be made whether this final week is inside or outside IR35 and unfortunately the decision makers are coming down in favour of inside. My strategy is to persuade them that I am only looking for outside status for this one week and then the contract ends.

          As I am on holiday next week and the client has said they want me back for another project, my thinking is that we draw up a new contract next week with the agent and if they deem the new contract inside IR35 then I up my day rate. Basically I give them two day rates, my current rate if outside IR35 and a higher rate for inside.

          Andrew
          Andrew,

          Make sure it's a lot higher - don't forget to take expenses into account.
          The greatest trick the devil ever pulled was convincing the world that he didn't exist

          Comment


            #6
            Originally posted by Scotchpie View Post
            I am in a similar position. My contract that started in October ends on Friday with final payment due on April 7th (bugger). So a decision has to be made whether this final week is inside or outside IR35 and unfortunately the decision makers are coming down in favour of inside. My strategy is to persuade them that I am only looking for outside status for this one week and then the contract ends.

            As I am on holiday next week and the client has said they want me back for another project, my thinking is that we draw up a new contract next week with the agent and if they deem the new contract inside IR35 then I up my day rate. Basically I give them two day rates, my current rate if outside IR35 and a higher rate for inside.

            Andrew
            Carrying on via your Ltd? Sounds risky.

            Comment


              #7
              Why are so many people accepting inside contracts????
              'CUK forum personality of 2011 - Winner - Yes really!!!!

              Comment


                #8
                Originally posted by northernladuk View Post
                Why are so many people accepting inside contracts????
                I'd accept one that's ten minutes from home on double my current day rate.

                The contract and working practices would look very different to my usual one and paint me as a general dogsbody though.
                The greatest trick the devil ever pulled was convincing the world that he didn't exist

                Comment


                  #9
                  Originally posted by northernladuk View Post
                  Why are so many people accepting inside contracts????
                  The demand for outside IR35 contracts has gone down but the supply of contractors remains the same.

                  Comment


                    #10
                    Attitude to risk

                    Moss,
                    It all depends on your view on risk - changing the agency would help, but is it still the same contract - maybe compare old and new 'LOT' numbers on the contract Description?

                    Comment

                    Working...
                    X