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Is contract IR35 compliant & who did you use to check yours?

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    Is contract IR35 compliant & who did you use to check yours?

    Hi All,

    First time poster but being lurking and reading for about a month now and have read so many of the articles on here.

    Who have you used for your contract review to ensure it is IR35 compliant?

    I have found <link removed - site terms and conditions> who offer a contract review for £100 inc VAT - but is anyone's opinion worth the paper it's written on?

    Below is a version of my contract and I've checked for susbsitution, control of work and mutuality of obligation. All thoughts and opinions would be most appreciated!

    Kind Regards,

    Gavin

    From Contract Confirmation Note:

    Project Services – Consultancy in relation to XXX Implementation Review Project

    Project Duration – Project duration will be approximately six months

    Fees – £XX.XX per hour (subject to 5% retention, to be paid upon completion)

    From Contract For Services

    RECITALS

    The Contractor is in the business as a provider of (the services) and has skills and abilities and can undertake services that may be of use to the Company’s Clients’ from time to time.

    The Company and the Contractor agree and intend that when the Contractor agrees to undertake services to the Company it will do so in accordance with the Operative Provisions of this Contract for Services.

    1. DEFINITIONS

    1.1 In these terms of engagement the Company, the Contractor, the Company’s Client, the Contract, the Project, Fees and the Project period are as stated on the attached Contract Confirmation Note.

    1.2 Unless the context requires otherwise references to the singular include the plural and references to the masculine include the feminine and vice versa.

    1.3 The headings contained in these terms are for convenience only and do not affect their interpretation.

    2. THE CONTRACT

    2.1 These terms constitute the contract between the Company and the Contractor upon being signed on behalf of the Contractor in relation to the Project.

    2.2 No variation or alteration to these Terms shall be valid unless approved by a Director of the Company in writing.

    3. FUTURE CONTRACTS

    3.1 The failure by the Company to offer future contracts to the Contractor shall not give rise to any liability on the part of the Company.

    3.2 The Contractor shall not be obliged to accept any future contract offered by the
    Company.

    4. TIMESHEETS AND INVOICES

    4.1 At the end of each week of the Project Period (or at the end of the Project Period where it is for a period of less than one week or is completed before the end of a week) the contractor shall deliver to the Company the Company’s timesheet duly completed to indicate the number of hours of services provided by the Contractor to the Company’s Client in connection with the Project during the preceding week and signed by an authorised representative of the Company’s Client. Such timesheets must be received by the Company no later than 12:00am on Tuesday following the week to which they relate.

    4.2 The Company shall not be obliged to pay any Fees to the Contractor unless a signed timesheet has been submitted by the Contractor in accordance with sub clause 4.1 and the Contractor has invoiced the Company for those Fees (with a VAT invoice where appropriate).

    5. FEES

    5.1 The Contractor will receive payment of the Fee from the Company for each hour of services provided by the Contractor to the Company’s Client in connection with the
    Project, but subject to clause 12.4 plus VAT where appropriate.

    5.2 The Contractor shall be responsible for all Corporation Tax, PAYE, Income Tax,
    National Insurance contributions and any other taxes and deductions payable in
    relation to the Fee and any payments made by the Contractor to the personnel
    engaged on the Project.

    5.3 All payments will be made to the Contractor.

    6. LIABILITY

    6.1 The Contractor shall be liable for any loss including but not limited to defective
    workmanship, damage or injury to any party resulting from the negligent act or
    omissions of its officers, employees or other personnel (including Contractor’s subcontractors) providing services for the Contractor in connection with the Project.

    6.2 The Contractor shall ensure the provision of adequate Employer’s Liability Insurance, Public Liability Insurance and any other suitable policies of insurance in respect of the Contractor and such personnel in relation to the project and shall make a copy of the policy available to the Company upon request.

    7. CONTRACTOR’S OBLIGATIONS

    7.1 The Contractor agrees on its own part and will procure that all personnel (including its sub-contractors) providing services for the Contractor in connection with the Project will act as follows:

    7.2 Not to engage in any conduct detrimental to the interests of the Company or the
    Company’s Client which includes any conduct tending to bring the Company or the
    Client into disrepute or which results in the loss of any custom or business.

    7.3 To take all reasonable steps to safeguard its own safety and the safety of any other person who may be affected by its actions in connection with the Project.

    7.4 To comply with all statutory obligations and codes of practice to which the Contractor is subject in respect of personnel engaged on the Project including but not limited to the working Time Regulations.

    7.5 Furnish the Company with any progress reports as may be requested from time to time.

    7.6 To notify the Company forthwith in writing if it should become insolvent, or subject to winding up petition.

    7.7 To comply with all the requirements of VAT legislation and the Companies Act 1981.

    8. ACKNOWLEDGEMENT

    8.1 The Contractor acknowledges that all copyright, trademarks, patents and other
    intellectual property rights deriving from services carried out by the Contractor and its
    personnel engaged on the Project for the Company’s Client shall belong to the Client.

    9. COMPUTER EQUIPMENT WARRANTY

    9.1 The Contractor shall ensure that any computer equipment and associated software, which it will provide to its staff for the purpose of providing the services, contains antivirus protection with the latest released upgrade from time to time and will be Year 2000 compliant.

    10. CONFIDENTIALITY

    10.1 The Contractor will not without prior consent in writing of the Company’s Client
    disclose, advertise or publicise any specification, plan, drawing, pattern, sample,
    information or data (including any computer data and/or software package) issued or
    furnished by or on behalf of the Client in connection with the Project to any person
    other than a person employed or engaged by the Client or any sub-contractor, supplier or other person concerned with the same either before, during or after completion of the Project.

    Any original or master specification, plan, drawing, pattern, sample, information or data (including any computer data and/or software package) mentioned in this paragraph, issued or furnished by or on behalf of the Client remains the property of the Client and must be returned to the Client on completion of the Project. When no longer required, copies of documents to be destroyed and/or disposed of during the course of and at the termination of the Project shall be first rendered indecipherable in a manner and by a method approved of by the Client.

    10.2 The Contractor will not use any motor vehicle for any business purposes during any Project unless adequate third party insurance cover is in force in respect of such use. The Contractor will at all times keep the Company and the Company’s Client
    indemnified against any liability, whether in respect of any insured risk or otherwise,
    incurred by the Company and the Client arising otherwise in connection with his use of any motor vehicle for any such purpose.

    11. TERMINATION
    11.1 This Contract may be terminated by the Company or the Contractor giving the other party the period of notice, if any, specified in the Contract Confirmation Note.

    11.2 Notwithstanding sub-clauses 11.1 of this agreement, either party may without notice and without liability terminate this contract if the other has acted in material breach of its terms.

    11.3 Notwithstanding sub-clauses 11.1 of this agreement, the Company may without notice and without liability terminate this Contract should the Contractor become insolvent, dissolved or subject to a winding up petition.

    12. LAW
    12.1 These terms are governed by the Law of England and Wales and are subject to the exclusive jurisdiction of the courts of England and Wales.

    12.2 Nothing in this Contract shall prohibit the Contractor from providing its services and those of its personnel to any other person from the Company.

    12.3 The Contractor is not obliged to provide services of any named individual in relation to the Project and may assign or sub-contract its rights and obligations under this Contract.

    12.4 The Contractor is not subject to the supervision direction or control of the Company or the Company’s Client in the manner of performance of the Project but shall (and will procure that all personnel engaged in connection with the Project shall) perform its obligations under this Contract and in relation to the Project with all reasonable care and skill and indemnify the Company against any breach of obligations. The Contractor must ensure that all personnel engaged by it in connection with the Project are suitably trained and qualified. Without limitation, the Contractor must rectify at its own cost any defective work it carries out.

    12.5 None of the personnel who are engaged by the Contractor in connection with the Project are employees of the Company or the Company’s Client and will not have any of the rights or protection given to employees of the Company or the Client by law nor be subject to the rules or procedures or receive the benefits applicable to either the Company’s or the Clients employees.

    #2
    4.2 is rubbish if you aren't opted out.

    I'd want an 11.4 giving me the right to terminate if the agency goes bust. And giving me the ability to go direct or through any other agency if they go bust, or if the contract is terminated because of a breach (11.2).

    Without knowing the definition of "Contractor" it's hard to have an opinion on the contract or not.

    If the contract doesn't reflect the upper contract between agency and client, it's a moot point. If the contract doesn't reflect the working conditions, then it's a moot point.

    I use qdos for my checks.

    IANAL.
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    Comment


      #3
      I'm not going to read all that for you, but I too use QDOS

      Comment


        #4
        The only people to tell you whether your contract is IR35 compliant, is the Special Tax Commissioners. Despite what everyone else will tell you, that's the truth.

        The best you can get is a contract that on the face of it is broadly in line with IR35.
        I couldn't give two fornicators! Yes, really!

        Comment


          #5
          Pcg

          Comment


            #6
            Gavin

            Have you actually started the contract?

            If not, a true review cannot be performed as it needs to take into consideration your actual working arrangements on site.

            Comment


              #7
              qdos

              Comment


                #8
                Thanks for all your responses. I went through the following process in deciding what to do.
                • Read all the IR35 articles on here.
                • Looked into the write ups on the Dragonfly case.
                • Asked members on here who people used.
                • Spoke to an accountant.


                As Sally (above) pointed out - it's apparently not just what your contract says but whether your practises mirror your IR35 compliant contract. I have decided to go with QDOS to check my contract as they have been recommended by people on here, are competively priced but more importantly seem switched on to IR35 issues based on what I had learned from "googling" IR35.

                Again - all your feedback was very much appreciated.

                Kind Regards,

                Gavin

                Comment


                  #9
                  Don't trust Dragonfly too much, that case is atypical. It confirmed that contract and working practices have to align - although we kind of knew that anyway - but the rest of the case is a bitmisleading. The main problem is that the contract, which started pre-IR35, was changed to include IR35-friendly clauses which were not refelcted on the ground. Plus the AA guy stod up and flatly contradicted the contractual terms in court.

                  You can find my potted guide to IR35 if you google for it; that'#s about as brief an explanation as you can get but does give you the key points. And while I have nothing against QDOS, who are indeed very good, the other key sources of IR35 contract reviews are Accountax and Bauer & Cotterill . Also go to the PCG website (www.pcg.org.uk) and have a good read.
                  Blog? What blog...?

                  Comment

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