Contractors 'Laptops not included' - IR35

[London1986]

Just been told with my current client that I fall inside IR35 because of one question on the gov site assessment questionnaire ...

"Will you have to buy equipment before your client pays you".

This does not include laptops...

I do have my own mac laptop which is required for my contract, to run specialist mac software. It's not just a basic laptop. I would not have got this contract without owning or purchasing this laptop.

So technically I should answer yes to this question, which would put me outside of IR35, however due to the 'this does not include laptops' disclaimer, I have been advised to answer no, which puts me INSIDE of IR35!

It doesn't really matter how I answer the rest of the questions, this is the question that holds the most weighting.

My issue is this contradicts pretty much every example everywhere on the GOV site which states that if you are required to provide your own equipment including laptops, you are operating as a business.

Is anyone else going through this same thing or had any luck appealing it?

I feel this is an oversight in the questionnaire itself.

[worsy]

It doesn't hold the most weight, can you post the answers to the questions?

the magic bullet is the substitution clause, but even if you have a fettered agreement then you can still get an outside determination. I suspect you have mis interpreted some of the other questions.

[London1986]

worsy said:

It doesn't hold the most weight, can you post the answers to the questions?

It does for me! Below are my answers. Based on that, I got outside of IR35, does not apply.


Have you already started working for this client? Yes

Will you be an ‘Office Holder’? No

Have you ever sent a substitute to do this work? No, it has not happened

Does your client have the right to reject a substitute? Yes

Have you paid another person to do a significant amount of this work? No

Does your client have the right to move you from the task you originally agreed to do? No, You would have to agree

Does your client have the right to decide how the work is done? No, you and your client agree together

Does your client have the right to decide your working hours? Yes

Does your client have the right to decide where you do the work? No, some work has to be done in an agreed location and some can be your choice

Will you have to buy equipment before your client pays you? Yes

Will you have to fund any vehicle costs before your client pays you? No

Will you have to buy materials before your client pays you? No

Will you have to fund any other costs before your client pays you? No

How will you be paid for this work? An hourly, daily or weekly rate

If the client was not happy with your work, would you have to put it right? Yes, you would fix it in your usual hours at your usual rate or fee

Will your client provide you with paid-for corporate benefits? No

Will you have any management responsibilities for your client? No

How would you introduce yourself to your client’s consumers or suppliers? This would not happen

Does this contract stop you from doing similar work for other clients? Yes

Are there any ownership rights relating to this contract? No

Have you had a previous contract with this client? Yes

Will this contract start immediately after the previous one ended? Yes

Will this work take up the majority of your available working time? Yes

Have you done any self-employed work of a similar nature for other clients in the last 12 months? No

[sideways sid]

London1986 said:

Just been told with my current client that I fall inside IR35 because of one question on the gov site assessment questionnaire ...

It sounds like a few more than one of those answers steer you inside IR35.

But regarding the purchase of equipment, has your LtdCo not bought a phone, any software licenses, peripherals for your home office, training etc that you depend upon to supply services to your current and future clients?

[deanoss]

London1986 said:

Does your client have the right to decide your working hours? Yes
If the client was not happy with your work, would you have to put it right? Yes, you would fix it in your usual hours at your usual rate or fee
Does this contract stop you from doing similar work for other clients? Yes

I would be more worried about these.

I'm sure your own licences software would can't as your own equipment.

Edited by deanoss on Friday 14th February 14:48

[London1986]

sideways sid said:

It sounds like a few more than one of those answers steer you inside IR35.

But regarding the purchase of equipment, has your LtdCo not bought a phone, any software licenses, peripherals for your home office, training etc that you depend upon to supply services to your current and future clients?

Based on the exact answers above, I am outside IR35, according to the gov questionnaire.

No they haven't. There may a couple of licences for some software here or there, but none which are essential to my role. All of those ar Amy responsibility.

deanoss why would I be worried if I the results of the questionnaire has come back with me being outside?

The main problem I am facing is solely around the equipment question

[Mr Pointy]

I'm very surprised you came up with an "outside" result given your answer to those questions. I'd have thought you were clearly inside.

[TheHat]

Mr Pointy said:

I'm very surprised you came up with an "outside" result given your answer to those questions. I'd have thought you were clearly inside.

I'd have thought the last question is the key.

[London1986]

To be honest, I agree with you.

The CEST tool does seem to be flawed which is worrying as it will have a huge impact on the economy. based on these answers.

[worsy]

deanoss said:

London1986 said:

Does your client have the right to decide your working hours? Yes
If the client was not happy with your work, would you have to put it right? Yes, you would fix it in your usual hours at your usual rate or fee
Does this contract stop you from doing similar work for other clients? Yes

I would be more worried about these.

I'm sure your own licences software would can't as your own equipment.

Edited by deanoss on Friday 14th February 14:48

Yes and this one:

Does your client have the right to decide where you do the work? No, some work has to be done in an agreed location and some can be your choice

The answer "The task dictates the location" is much better.

[JulianPH]

Mr Pointy said:

I'm very surprised you came up with an "outside" result given your answer to those questions. I'd have thought you were clearly inside.

My thoughts too.

[London1986]

I agree but it's true. Try it yourself if you like with the answers I've given above.

[Eric Mc]

It's been cancelled - until April 2021.

[Clockwork Cupcake]

London1986 said:

Does this contract stop you from doing similar work for other clients? Yes

That's Restraint of Trade. Why on earth would you agree to such a contract? The rights to parallel contracts / multiple clients is an important consideration for operating outside of IR35 and has been for the past 20-odd years.

[Hungrymc]

London1986 said:

I agree but it's true. Try it yourself if you like with the answers I've given above.

The trouble with the tool is that its giving a binary answer to a complex question. You can be massively inside or marginally inside (and same for outside) but you don't know from the tool. There are some tools out there that claim to reflect the weighting and the scoring so can give a better indicator of how each answer influences the determination (and by what margin).

I'm amazed that some companies have determined inside, and are now cancelling the determination for 12 months.... but I guess government and HMRC have much bigger fish to fry for the next 12 months anyway.