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Working as sole trader?

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    Working as sole trader?

    Hi

    I'm a bit new to this game so bear with me.

    I have worked as a sole trader for sometime; arrangement is I agree a price for a job and work from my own premises so have none of those R35 issues.

    I have done one contract as an employee via an umbrella company. I was told that this was the way to go as I didn't have a ltd co because it provided assurance to the cleint that NICs were being paid.

    I've now got an op with a client who wants to bypass recruitment co's and deal direct with me on a day rate working on their premises.

    My question is, if the client is happy is there any reason why I can't work direct as a sole trader selling my services on a time basis or will the IR see this as a contract and expect employer NICs to be paid by me?

    I expect the answer boils down to how the contract is written but this is another cause for concern; the cleint seems to want to avoid cost of recruitment agency, contracts and hasn't even thought of timesheets. I am wary of the absence of these and how I would deal with the client if they turned out to be a bad payer.
    Last edited by bikeman; 18 March 2012, 08:06.

    #2
    I've just found this article which suggests that working on a regular payment basis for them could cause problems with HMRC.

    Why contractors cannot trade as sole traders

    So I guess I need to involve my umbrella company. They will require a contract. As the client hasn't even considered a contract it might be an op for me to have a contract on my terms. Has anyone got a standard contract that would be suitable?

    Comment


      #3
      Yes you probably will. Clients and agents won't deal with sole traders as they'ed be liable for the NI if you don't pay it and HMRC come a'knocking.
      "I can put any old tat in my sig, put quotes around it and attribute to someone of whom I've heard, to make it sound true."
      - Voltaire/Benjamin Franklin/Anne Frank...

      Comment


        #4
        Originally posted by bikeman View Post
        I've just found this article which suggests that working on a regular payment basis for them could cause problems with HMRC.

        Why contractors cannot trade as sole traders

        So I guess I need to involve my umbrella company. They will require a contract. As the client hasn't even considered a contract it might be an op for me to have a contract on my terms. Has anyone got a standard contract that would be suitable?
        iIRC this was not always so, through cant recall the legislation that stopped this
        Politicians are wonderfull people, as long as they stay away from things they don't understand, like working for a living!

        Comment


          #5
          Would you not consider the limited company route for your business at all? Dependent on your income you are almost certain to be better off than sole trader and certainly better off than umbrella.

          Comment

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