Contracting Outside IR35 from April 2020 Offer Contracting Outside IR35 from April 2020 Offer
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  1. #1

    Nervous Newbie


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    Default Contracting Outside IR35 from April 2020 Offer

    Hi Guys

    New to the forum but I wanted to get some advice from you all, I'm having a read and it's generally looking like most companies including the one that I'm currently working for want me to go down the umbrella route.

    However, I have been offered an opportunity to continue working through my limited company for my old boss who has now set up her own consultancy company but I just wanted to get your opinion on the legitimacy of this. Mid to large organisation will be subject now to pay tax for their contractors hence why they want everyone to go PAYE, however as my old boss is considered a small company, i.e. not turning over more than £10 million a year, he claims that they are exempt from IR35. In other words the onus isn't on his company but me alone.

    First question is, is this true?
    Secondly, what is the general noise post March 2020. Will the IR35 team be investigating everyone who is operating outside IR35 or is it just your luck?

    If it helps some more information on this, I'll be considered a remote worker, so the usually employee working practice wont apply to me.

    Any help would be greatly appreciated. Thanks in advance.

  2. #2

    My post count is Majestic

    northernladuk's Avatar
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    Yes it's true. Just means you make your own determination as usual.

    Just luck if you get investigated.

    You won't be working for you old boss by the way.

    Oh... Re-reading...consultancy company? Need more info. What is your relation to the end client, not your bosses company. What work will you be doing? It could be the end client had to make the determination.
    'CUK forum personality of 2011 - Winner - Yes really!!!!

  3. #3

    Fingers like lightning


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    I think it is fair to say the 'small consultancy' based on 'banded together bunch of contractors' route is yet to be really determined as to whether this will be an issue for In/Outside IR35 determinations.

    It is currently thought that large consultancies are rubbing their hands together with glee as, subsequent to contractors being binned across the landscape, they are now expecting all doors open to them to provide services. But, if a contractor works for Accenture, who then places them at Big Bank Inc, presumably it is still the end client who has to be made aware that as part of the Accenture team, there is one rogue contractor for whom the end client still has to give consideration...?

    So, your consultancy might still be required to make your presence known to the client/s and for you, there is no change to escaping the new regs.

    Also, you say 'he' and 'her' in the same breath... Confused as to the players in your scenario.
    Last edited by simes; 14th January 2020 at 13:47.

  4. #4

    Nervous Newbie


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    Thanks for replying guys.

    Firstly its co-owned my old bosses company hence the her and his terminology, apologies about this, same person!

    Some more information on this, I'll be contracted to work for her (old boss) company and then she would place me on assignment to end clients. To make matters worse is that my ex-boss company is based in the Netherlands and as they have more European clients and one of co-owner lives out there but the end client where I would be on assignment is UK based. Does this change things?

    Just spoke to a gent from Qdos and he's advised that this needs reviewing from a senior tax consultant due to the the uniqueness but he said that in terms of how the operation is, it seemed legit, in the sense that I work for a small consultancy firm (who have others perm members of staff) who sources work.

  5. #5

    Fingers like lightning


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    Well, if you can arrange it so you are paid from abroad, then this ends it right there.

    HMRC / Treasury jurisdiction ends at the Channel.

  6. #6

    Still gathering requirements...


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    Quote Originally Posted by MrLondoner View Post
    I'll be contracted to work for her (old boss) company and then she would place me on assignment to end clients. To make matters worse is that my ex-boss company is based in the Netherlands and as they have more European clients and one of co-owner lives out there but the end client where I would be on assignment is UK based. Does this change things?
    This sounds very much like the end client would be the fee payer since your old boss's company is simply providing you as a body to work on their project or whatever. So I reckon it would fall under the new rules and that end client would need to make a status assessment.

    It'd probably be quite different if your old boss's company was providing a complete solution, for example, and you were only on site as a SME to gather requirements or help implement the already developed solution.

    I'm no tax expert BTW so my opinion is worth what you paid for it

  7. #7

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    Quote Originally Posted by Snooky View Post
    This sounds very much like the end client would be the fee payer since your old boss's company is simply providing you as a body to work on their project or whatever. So I reckon it would fall under the new rules and that end client would need to make a status assessment.

    It'd probably be quite different if your old boss's company was providing a complete solution, for example, and you were only on site as a SME to gather requirements or help implement the already developed solution.

    I'm no tax expert BTW so my opinion is worth what you paid for it
    +1 - the small client needs to be doing more than just passing on a resource - they will need to provide a significant layer of project management or project and financial risk to override the end clients responsibility.
    merely at clientco for the entertainment

  8. #8

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    Quote Originally Posted by Snooky View Post
    This sounds very much like the end client would be the fee payer since your old boss's company is simply providing you as a body to work on their project or whatever. So I reckon it would fall under the new rules and that end client would need to make a status assessment.

    It'd probably be quite different if your old boss's company was providing a complete solution, for example, and you were only on site as a SME to gather requirements or help implement the already developed solution.

    I'm no tax expert BTW so my opinion is worth what you paid for it

    She isn't just distributing work, the project management, timelines, deliverable etc. between her and the end client are outlined and she and some others from her company will be working along side me at the end clients site.

    I would never report to anyone at the end client site but would deal with my ex-boss, any issues, financial responsibilities wouldn't be on or my company but would be between the end client and my ex-bosses company. If for example I made a blunder at the end client site, the end client would take this up with my bosses company (she would probably then take this up with me, no doubt ).

  9. #9

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    Sounds like you are working in the same way as one of her employees so just a temp for her not an independent contractor so you've got a problem if you are self determining.
    'CUK forum personality of 2011 - Winner - Yes really!!!!

  10. #10

    Fingers like lightning


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    Quote Originally Posted by simes View Post
    I think it is fair to say the 'small consultancy' based on 'banded together bunch of contractors' route is yet to be really determined as to whether this will be an issue for In/Outside IR35 determinations.

    It is currently thought that large consultancies are rubbing their hands together with glee as, subsequent to contractors being binned across the landscape, they are now expecting all doors open to them to provide services. But, if a contractor works for Accenture, who then places them at Big Bank Inc, presumably it is still the end client who has to be made aware that as part of the Accenture team, there is one rogue contractor for whom the end client still has to give consideration...?

    So, your consultancy might still be required to make your presence known to the client/s and for you, there is no change to escaping the new regs.

    Also, you say 'he' and 'her' in the same breath... Confused as to the players in your scenario.
    Quoting myself, vindication of the above in today's news.

    IR35 reform: HSBC bans its consultancies from supplying limited company contractors

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