Contractors: IR35 & general discussion
Discussion
I’ve been thinking about this and wonder if the application of ir35 might actually be an opportunity for me. I mainly work in construction/ utilities/ oil and gas industry but wonder if this would be possible:
say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
malks222 said:
I’ve been thinking about this and wonder if the application of ir35 might actually be an opportunity for me. I mainly work in construction/ utilities/ oil and gas industry but wonder if this would be possible:
say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
I don't think so. As I understand it, once a Medium / Large business enters the chain, the whole chain becomes liable and loses the small business exception.say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
I could be wrong though.
malks222 said:
I’ve been thinking about this and wonder if the application of ir35 might actually be an opportunity for me. I mainly work in construction/ utilities/ oil and gas industry but wonder if this would be possible:
say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
If you’re just providing resource on a day rate then the IR35 decision just gets pushed to the end client anyway. The description of “fill gaps” does seem to indicate that might be the case.say I approached one of the bigger firms (SSE/ Scottish Power/ Scottish Water) and was an approved supplier for QS/ Cost Consultancy services, am I able to provide them this service?
As a small business, (under 50 employees, under £10mil turn over and less than £5mil on the balance sheet) I am not responsible for IR35 ruling, and this would lie with anyone I engage.
Could my consultancy use freelance/ contract people to fill gaps if and when I needed too, placing them with end users? and possibly start employing a few staff members and placing them with end users as things grow? Basically building myself into a small sized QS consultancy but staying below the ir35 threshold which allows me the freedom to engage with contractors if/ when I need them??
If you meet HMRCs definition of a managed service provider then that could work. Could it be run billing per job/deliverable rather than T&M contracts?
One thing to watch is many organisations are now enforcing the PSC ban up their supply chain.
CaptainSlow said:
I think we need to start a list of umbrella's allowable pension arrangements, FCSA registered only.
I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Parasol said that after 12 weeks I would have a 9% deduction into a nest pension unless I opt out. I could then contribute from my gross income to a private pension. I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Edited by Gazzab on Tuesday 25th February 12:52
Gazzab said:
If you are declared as inside then you run the risk of retrospective investigations and pain.
I started my current contract (new client) end of January this year. I have just been determined as inside IR35. They have given me a couple of options - one is to remain contracting but inside IR35, the other is a staff role. Do we think that the same risk of retrospective investigation remains if we move from "contractor outside IR35" to staff with the same client/employer? If I stayed contract but switched inside IR35, do we think they will only look back as far as the start of my current engagement or will they dig as far as they can, and if so, how far back is that?8bit said:
Gazzab said:
If you are declared as inside then you run the risk of retrospective investigations and pain.
I started my current contract (new client) end of January this year. I have just been determined as inside IR35. They have given me a couple of options - one is to remain contracting but inside IR35, the other is a staff role. Do we think that the same risk of retrospective investigation remains if we move from "contractor outside IR35" to staff with the same client/employer? If I stayed contract but switched inside IR35, do we think they will only look back as far as the start of my current engagement or will they dig as far as they can, and if so, how far back is that?Clockwork Cupcake said:
I don't think so. As I understand it, once a Medium / Large business enters the chain, the whole chain becomes liable and loses the small business exception.
I could be wrong though.
I thought that only related to companies within the group?? eg RBS couldn’t set up 5 small companies for the contractors to work for, because they’d all still be part of the same group. I could be wrong though.
but my small consultancy would be a stand alone business offering business to business services??
wombleh said:
If you’re just providing resource on a day rate then the IR35 decision just gets pushed to the end client anyway. The description of “fill gaps” does seem to indicate that might be the case.
If you meet HMRCs definition of a managed service provider then that could work. Could it be run billing per job/deliverable rather than T&M contracts?
One thing to watch is many organisations are now enforcing the PSC ban up their supply chain.
Yes- I would want my consultancy to be offering a cost consultancy service, professional services, set out deliverables etc....... but could my consultancy use its own PAYE staff, and supplement with contractors if required (eg sudden demand for additional resources) because my consultancy would be deemed a small business, which then means ir35 determination would be down to a contractor I engaged? If you meet HMRCs definition of a managed service provider then that could work. Could it be run billing per job/deliverable rather than T&M contracts?
One thing to watch is many organisations are now enforcing the PSC ban up their supply chain.
The new legislation makes end client responsible for determinations all the way down the supply chain so there is a very high chance you won't be able to use contractors for a service company. My current client has told all it's managed service companies to clean house, place contractors inside IR35 or they can no longer provide services to them. HMRC have really scored a home run with this one. They've placed the onus and liability on the weakest, most risk averse link in the chain and just let them do the rest.
Gazzab said:
CaptainSlow said:
I think we need to start a list of umbrella's allowable pension arrangements, FCSA registered only.
I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Parasol said that after 12 weeks I would have a 9% deduction into a nest pension unless I opt out. I could then contribute from my gross income to a private pension. I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Edited by Gazzab on Tuesday 25th February 12:52
The salary sacrifice element is important.
CaptainSlow said:
Gazzab said:
CaptainSlow said:
I think we need to start a list of umbrella's allowable pension arrangements, FCSA registered only.
I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Parasol said that after 12 weeks I would have a 9% deduction into a nest pension unless I opt out. I could then contribute from my gross income to a private pension. I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Edited by Gazzab on Tuesday 25th February 12:52
The salary sacrifice element is important.
https://www.parasolgroup.co.uk/our-offering/employ...
CaptainSlow said:
Gazzab said:
CaptainSlow said:
I think we need to start a list of umbrella's allowable pension arrangements, FCSA registered only.
I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Parasol said that after 12 weeks I would have a 9% deduction into a nest pension unless I opt out. I could then contribute from my gross income to a private pension. I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Edited by Gazzab on Tuesday 25th February 12:52
The salary sacrifice element is important.
Gazzab said:
CaptainSlow said:
Gazzab said:
CaptainSlow said:
I think we need to start a list of umbrella's allowable pension arrangements, FCSA registered only.
I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Parasol said that after 12 weeks I would have a 9% deduction into a nest pension unless I opt out. I could then contribute from my gross income to a private pension. I don't know of any that will pay into a SIPP, Contractor Umbrella do salary sacrifice into a Scottish Widows fund. Parasol is NEST only.
Edited by Gazzab on Tuesday 25th February 12:52
The salary sacrifice element is important.
Guvernator said:
The new legislation makes end client responsible for determinations all the way down the supply chain so there is a very high chance you won't be able to use contractors for a service company. My current client has told all it's managed service companies to clean house, place contractors inside IR35 or they can no longer provide services to them. HMRC have really scored a home run with this one. They've placed the onus and liability on the weakest, most risk averse link in the chain and just let them do the rest.
The have said that the client needs to take 'reasonable care'.The client can't be bothered to to do that properly, as no one will get fired for saying 'profits affected by ir35 turnover' but they will get fired if they don't take reasonable care and wing it, to be caught later.
So tell everyone take it or leave it, then assess on a exception basis if anyone who leaves is it is someone of note, is clearly the best way for the client.
Guvernator said:
The people who are doing the assessments at my client have been told if an incorrect assessment leads to an investigation by HMRC, they will face a disciplinary and a fine will lead to dismissal.
Now imagine how those assessments will go with things like that hanging over your head.
surely it's down to the client to do the assessment properly? They are the ones that created the role, scoped it, created the contract, and are responsible for the decision! Now imagine how those assessments will go with things like that hanging over your head.
Blown2CV said:
Guvernator said:
The people who are doing the assessments at my client have been told if an incorrect assessment leads to an investigation by HMRC, they will face a disciplinary and a fine will lead to dismissal.
Now imagine how those assessments will go with things like that hanging over your head.
surely it's down to the client to do the assessment properly? Now imagine how those assessments will go with things like that hanging over your head.
Where I am, all the contractors got exactly the same worded copied and pasted assessments, even across 3 very different work roles.......all prepared by a remote HR department based in a HQ office building 50 miles away from the project site were are based at. They even said they provided us with PPE which isn't the case.
Anyone know how you go about contracting in Dublin? I've been discussing a role out there but it seems pretty complicated that I need to setup an Irish business account, go through an umbrella of sorts. Obviously paid in Euro's so there could be some currency fluctuations.
I'm not sure how the tax in Ireland works, how I would get the cash out of the business in a tax efficient way, would you potentially get double taxed etc?
Does anyone have any information they can share?
I'm not sure how the tax in Ireland works, how I would get the cash out of the business in a tax efficient way, would you potentially get double taxed etc?
Does anyone have any information they can share?
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