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NW forcing an IR35 contract review

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    NW forcing an IR35 contract review

    I have recently joined NW, I declared based on my own review of my contract vs IR35 regulations online that I was exempt. After signing the accountancy contract with NW and paying the first month's fee, NW are saying they will not pay any salaries to me unless I provide proof of IR35 exemption eg. IR35 contract review from QDOS

    I think this is wrong:
    - I was not advised of this clause in my contract with NW so it's not very helpful they add it now immediately after I've paid.
    - there are no official IR35 guidelines so any contract review is a best-guess anyway.
    - ultimately it's my responsibility to pay any tax shortfall if caught by an IR35 investigation not NW

    Are NW allowed to stipulate they must have the results of an IR35 contract review before paying salaries? Do other firms do this? If not I'm thinking about switching.

    #2
    Hi qtech - it is not our policy to force clients to have their contract reviewed, though we do recommend it. If you say, having reviewed the contract yourself, that IR35 does not apply then we will take your word for it.

    If you have been advised otherwise then please send me a private message, or email me on [email protected] with details and I will look into this for you immediately.

    Thanks
    Craig

    Comment


      #3
      Assuming you are the director and employer in your own company, it is up to you how much you pay yourself and when. Your accountant/adviser should be there to advise you on what to look out for and stay compliant. Ultimately it comes down to you.

      In terms of IR35, perhaps they're looking for a self certification that you're operating outside of IR35 in order to set up your payroll correctly. Again, it's up to you, with your advisers best advice, to decide whether you're in or out.

      Also, heads up...be aware of RTI which comes into force soon.

      Comment


        #4
        They do have a point. If you are found to be inside IR35 and you didn´t have a review from an accountant or lawyer HMRC could accuse you of tax fraud. I would advise in any case having a professional review. In this way if you are caught inside it would just be back tax and interest and not fines and penalties on top. It seems that they´re just covering themselves. It´s not a legal requirement to have a review but it is prudent unless you are clearly outside IR35.
        I'm alright Jack

        Comment


          #5
          Unless you're a freelance lawyer, you should be careful. Legal wording is such a minefield, a recent contract review I had suggested changing one word from 'approved' to 'agreed', so although probably not a big deal, HMRC will be looking for any hooks if you're ever investigated.

          Plus there's an argument that an official 3rd party contract review shows due diligence that you would expect a legit company to carry out, thereby helping to reinforce your argument that you are outside IR35.

          And if you happen to have QDOS PI policy, you get 3 free reviews anyway.

          Comment


            #6
            Originally posted by qtech View Post
            I have recently joined NW, I declared based on my own review of my contract vs IR35 regulations online that I was exempt. After signing the accountancy contract with NW and paying the first month's fee, NW are saying they will not pay any salaries to me unless I provide proof of IR35 exemption eg. IR35 contract review from QDOS

            I think this is wrong:
            - I was not advised of this clause in my contract with NW so it's not very helpful they add it now immediately after I've paid.
            - there are no official IR35 guidelines so any contract review is a best-guess anyway.
            - ultimately it's my responsibility to pay any tax shortfall if caught by an IR35 investigation not NW

            Are NW allowed to stipulate they must have the results of an IR35 contract review before paying salaries? Do other firms do this? If not I'm thinking about switching.
            The fact you seem to think you are 'exempt' rather than inside or outside IR35 starts the alarm bells ringing with me. If you can't use the right terminology I think advice to look in to it further is pretty well founded IMO.

            Basing a review on professional interpretation and existing case law is hardly best guess.

            Why is NW paying your salary?
            Last edited by northernladuk; 26 March 2013, 10:29.
            'CUK forum personality of 2011 - Winner - Yes really!!!!

            Comment


              #7
              Originally posted by northernladuk View Post
              The fact you seem to think you are 'exempt' rather than inside or outside IR35 starts the alarm bells ringing with me. If you can't use the right terminology I think advice to look in to it further is pretty well founded IMO.

              Basing a review on professional interpretation and existing case law is hardly best guess.

              Why is NW paying your salary?
              +1

              Comment


                #8
                Originally posted by northernladuk View Post
                The fact you seem to think you are 'exempt' rather than inside or outside IR35 starts the alarm bells ringing with me. If you can't use the right terminology I think advice to look in to it further is pretty well founded IMO.

                Basing a review on professional interpretation and existing case law is hardly best guess.

                Why is NW paying your salary?
                Just to make this clear: we do not actually pay the salary - we prepare the payroll and provide a payslip, the client should then make a payment from the company to their personal account based on the payslip. We are unable to prepare any payroll for our clients until we have confirmation of their desired salary level - if inside IR35 then the salary level is set by the legislation.

                Hope this clarifies.
                Craig

                Comment


                  #9
                  Originally posted by Craig at Nixon Williams View Post
                  Just to make this clear: we do not actually pay the salary - we prepare the payroll and provide a payslip, the client should then make a payment from the company to their personal account based on the payslip. We are unable to prepare any payroll for our clients until we have confirmation of their desired salary level - if inside IR35 then the salary level is set by the legislation.

                  Hope this clarifies.
                  Craig
                  Yeah, I know really, was more a point to the OP. Hard to take a post seriously when it is so badly written.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

                  Comment


                    #10
                    Originally posted by qtech View Post
                    I have recently joined NW, I declared based on my own review of my contract vs IR35 regulations online that I was exempt. After signing the accountancy contract with NW and paying the first month's fee, NW are saying they will not pay any salaries to me unless I provide proof of IR35 exemption eg. IR35 contract review from QDOS

                    I think this is wrong:
                    - I was not advised of this clause in my contract with NW so it's not very helpful they add it now immediately after I've paid.
                    - there are no official IR35 guidelines so any contract review is a best-guess anyway.
                    - ultimately it's my responsibility to pay any tax shortfall if caught by an IR35 investigation not NW

                    Are NW allowed to stipulate they must have the results of an IR35 contract review before paying salaries? Do other firms do this? If not I'm thinking about switching.
                    As a matter of interest what within your working practises has led you to be convinced that you are outside IR35?
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