Public sector and inside IR35

[kristen330]

Hi guys,

I just wanted to bring to everyones attention a scenario in which you can work in the public sector and be outside IR35. I am working through an agency, and the council contact advised me that the contract will lie outside IR35 because I will technically be working for a supplier who won a council tendered contract, so technically I'll not be working for the council but for a private company. Both the council and agency who I got the job through have both reiterated that the role is outside IR35 because of this.

For those who know about the legislation a bit more - is this arrangement legitimate? Is what they're saying true?

[FrontEnder]

Hi guys,

I just wanted to bring to everyones attention a scenario in which you can work in the public sector and be outside IR35. I am working through an agency, and the council contact advised me that the contract will lie outside IR35 because I will technically be working for a supplier who won a council tendered contract, so technically I'll not be working for the council but for a private company. Both the council and agency who I got the job through have both reiterated that the role is outside IR35 because of this.

For those who know about the legislation a bit more - is this arrangement legitimate? Is what they're saying true?

So the contract chain is you > agency > consultancy > public sector org?

It shouldn't put you outside IR35 just because there's an extra link in the chain.

[fidot]

It's not the number of links in the chain that puts you outside. It depends on what the private company is delivering to the end client e.g. a product versus bodies

[fidot]

See the section titled

I work via a consultancy to the public sector - do the rules apply to me?

In the first faq post of this forum

[jamesbrown]

Is what they're saying true?

Not in the way you've expressed it. If the private company is delivering a fully outsourced function, then it's outside of the scope of of the new legislation (that is, 10(2) of the ITEPA, FWIW). An indicator might be that you only deal with the private company, and don't deliver on council premises, but it really depends on the contract between the council and your client. The only way to be sure is to have the assessment in writing. Liability rests with the fee payer, notwithstanding exceptional circumstances.

Also, being outside of the scope of 10(2) does not mean being outside of IR35, so if it's outside of scope, you'll still need to apply due diligence.

[cojak]

http://forums.contractoruk.com/publi...ml#post2394875

Get that advice IN WRITING.

[mudskipper]

As jamesbrown has said there are two things that may have happened here

1) The PS client believes your role, via the supplier does not fall within the scope of the new legislation - i.e. the rules do not apply, and the PS client does not have to make an IR35 determintion.

Or

2) The role does fall within scope, the client has made a determination and decided that IR35 does not apply.

It is crucial that you understand which you are being told (and get it in writing!).

If the former, then IR35 hasn't gone away, but you need to decide whether or not it applies. Pretty much the same as before the 6 April.

If the latter, then you are indeed outside IR35 and happy days. The PS client should be able to advise you of the reason for their decision, but the liability does not rest with you.

[psychocandy]

OP- As others have said its the end client who decides so be careful here.

I was in a similar situation and consultancy kept coming up with this crap. Mainly because they didnt have a clue and hadnt even sorted it out properly.