Opt Out

[NewMan]

I'm in the process of moving from perm to contract. I have my first contract and have lots of questions, which I'm hoping will receive answers when I find myself an accountant.

Three questions at this point:

1) What are people's expereince on whether to pick an accountant who you can easily meet face-to-face vs. one where all comms are done remote?

2) The contract is via an agency and they have included a separate page for me to sign to state that I wish to Opt Out of "Work Seeker" status (Conduct of Employment Agencies and Employment Business Regulations 2003)". The benefits for me appear to relate to IR35 but I'm not convinced. Does anyone have expereince of this?

3) Can I rely on an Accountant to review the contract for IR35 or should i seek more specialist legal expertise?

Thanks in advance.

[MrRobin]

1) I don't have any problem with having an accountant that is 200 miles up the M5... everything is done by phone and post, and rather efficiently too. If being able to meet your accountant is important to you then fair enough but I'd rather use one that has specific / specialist experience dealing with IT contractors (Nixon Williams)

2) To be honest I think I'll leave answering this question to someone else, I'd probably not explain very well, or even be incorrect...

3) Again, accountants whom have a lot of experience with IT contractors will know their stuff and know what they're doing so don't see any need to get hold of a separate law firm... SJD accountancy have a contract review service which is free if it does not pass IR35 and something like £75 if it does.

[Dark Black]

1) and 2) ditto MrRobin's replies

3) Bauer & Cottrell - I can't recommend them enough... fantastic. Sarah and Kate did an excellent job in reviewing and then negotiating with the FD (who thought he knew it all) of the agency I was dealing with to get my contract changed to a proper supply-based one which reflected the actual working practices of the gig. Top Banana.

[malvolio]

AS regards Opt Out, there's a detailed guide to it all on the PCG's website (you are a member, aren't you.... ). O r have a search oin here if you have a few hours to kill...

Meanwhile do not sign the agency's letter under any circumstances. Write your own one, which only need say that you and YourCo do not wish the Agency Regulations to apply to any contract with TheAgency. You are opted in by default, you can only opt out before you are introduced to the client (in practice at the point you go for an interview).

The opt out is there because PCG were concerned that the regs applied limits on freelances that could potentially damage some business models, so they fought for and won the right for a worker to opt out of the regs in their entirety.

What are they? Nothing to do with IR35, for one thing. The agency regs are primarily intended to protect the interests of agency workers (like office temps, that kind of worker) and not contractors as we understand the term. However, they do provide a couple of useful benefits, in that you have to be paid whether or not the agency has been, there is an 8-week limit on handcuff clauses and a few other things. However they also involve the agency in significant extra work, so they try to get you to opt out. What the canny player will do is say, OK, I'll opt out but I want these changes in my contract to get me away from IR35.

You need to read the guides full to understand it all. PCG's advice was always to opt out, and many still do, but opinions are changing.

[NewMan]

I passed the Opt Out letter by the accountant I'm looking to go with and the reply was "In general for IR35 the 'opt out' is thought to be a must so in general we say need to opt-out."

[malvolio]

I passed the Opt Out letter by the accountant I'm looking to go with and the reply was "In general for IR35 the 'opt out' is thought to be a must so in general we say need to opt-out."

In which case, go get a new accountant. The opt out is absolutely nothing to do with IR35 and if he thinks that then he is clearly not up to the job.

Secondly, I repeat DO NOT SiGN THE AGENCY-PROVIDED OPT OUT, since it will invariably contain extra clauses you do not want. Write your own.

Oh and sorry for providing real and accurate advice, but you did ask...

[NewMan]

I value all opinions but the Accountant is SJD. Are you saying they're not up to the job? The Agent supplied Opt Out is quite simple and straight forward (see below). How would you suggest re-phrasing it? I'm not being forced to sign this but understand it's in my interest to do so because it demonstrates/supports a view that I'll be outside IR35. I'm also told PCG have campaigned for the right for IT contractors to Opt Out.


"This Opt Out Notification is supplement to the agreement between XXX Limited and the Contractor. The terms used in this ntoification shall have the same meaning as those defined in the Agreement.

The Contractor and the individual acknowledge that it is their intention that the provisions of the Conduct of Employment Agencies & Employment Business Regulations 2003 do not apply to the Assignment or to any future assignment agreed between the parties

The parties have freely enterd into this Opt Out.

Further that the individual is free to withdraw from this Opt Out notification at any time by giving not less than one week's written ntoice to XXX Ltd. However, where notice is given during the assignment it will not take effect until the individual stops working in the position in question".

[THEPUMA]

There is a comprehensive report on the pros and cons of opting out available if you join the PCG. That is probably worth the entrance money alone.

You have to sign the opt-out before meeting the client though, so the point may be moot.

It is generally accepted to help your IR35 case but if you have an "IR35-friendly" contract then that is probably irrelevant.

The PCG's case for opting out seems to be that if everyone failed to opt out, rates would have to fall. But it's a bit prisoner's dilemma. Disregarding the IR35 aspect, if you don't opt out, you are probably better off this time around as you may be able to negotiate a better renewal rate in some unusual circumstances.

Then again, your agency may choose not to find you any work next time you approach them. They wouldn't admit to it of course.

All the above is paraphrased. Join the PCG and get the full report.

[NewMan]

Thanks.

[TheFaQQer]

I value all opinions but the Accountant is SJD. Are you saying they're not up to the job? The Agent supplied Opt Out is quite simple and straight forward (see below). How would you suggest re-phrasing it? I'm not being forced to sign this but understand it's in my interest to do so because it demonstrates/supports a view that I'll be outside IR35. I'm also told PCG have campaigned for the right for IT contractors to Opt Out.


"This Opt Out Notification is supplement to the agreement between XXX Limited and the Contractor. The terms used in this ntoification shall have the same meaning as those defined in the Agreement.

The Contractor and the individual acknowledge that it is their intention that the provisions of the Conduct of Employment Agencies & Employment Business Regulations 2003 do not apply to the Assignment or to any future assignment agreed between the parties

The parties have freely enterd into this Opt Out.

Further that the individual is free to withdraw from this Opt Out notification at any time by giving not less than one week's written ntoice to XXX Ltd. However, where notice is given during the assignment it will not take effect until the individual stops working in the position in question".

I thought you can opt in at any time (which takes effect for future engagements only), and don't need to give any notice of your intention to do so.