Impact of client being overseas on IR35

[TobyV]

Hello

First time poster here. I'm wondering if anyone has any experience of contracting in the UK for a non-UK company?

My situation is that I have been working from home for a client based in the US for a while via an umbrella and I am considering starting a ltd. company. TBH if the client was UK based I would be pretty certain that I would be caught out by IR35 as I am considered one of their employees in all but name but I just wondered if their being overseas made any difference?

Thanks in advance for any light anyone can shed on this.

Toby

[Danbro]

Danbro Accounting Ltd

Hi Toby,

If you opened a UK company and your contract showed you as being Inside IR35 then the location of the end client wouldn't be applicable.

You would still be liable for IR35 through your UK company.

Thanks

Neil Ormesher

[TobyV]

Thanks Dan - that makes sense

Toby

[ASB]

Specialist advice may prove beneficial.

IR35 is based on a notional contract between the service provider and the final client. If that client is an overseas company with no UK branch then the situation does become confused.

Once the content of the notional contract has been established does it still amount to a contract of employment under UK law.

There are also questions as to whether the NI provisions are applicable. There are circumstances where ER's NI is not payable when the employer is a foreign company.

[The Lone Gunman]

The location of the end client has no bearing on your IR35 status.
It all depends on the business relationship.
I have not seen your contract nor do I know the circumstances which you say makes you a defacto emplyee.
I suspect that you working in the UK and supplying the work produced to a US based client should be quite easy to show as outside IR35.

Go away and read the IR web site as to what makes you caught, then come back and tell us why you are caught.

Particularly look into: Command and control. Are you supervised and instructed. Mutuality of obligation. Do you have to accept all work or are you contracted to a specific set. Substitution. Do you have to do all works yourself? (how would they know).

[TobyV]

Thanks everyone for taking the time to reply to this. It certainly looks as if it's not as clear cut as I had first assumed and I will need some specialist advice.

ASB - you are correct, it is a US company with no UK branch. Basically there are about 20 employees in the US and me over here who they recruited as they wanted someone to work overnight (their time) and also to start handling some UK/Europe-based clients (i work as a project manager/programmer).

Thanks again guys - i will keep you posted.

Toby