Placing contractor from my ltd company

[kapszone]

Hello Everyone, need you advise.
I have a requirement from one of my clients where I worked in past, they want a resource for the project and I have a resource to be placed. Now what you think is the best way to place that resource to that company, should I show him as a employee in my company and get a contract signed between my ltd company and the client or should I simply ask him to get a contract signed by his company and give me my share of commission ?

If I go by first option, I think to get:
1) Contract signed between Client and my ltd company showing that person as my company employee and consultant onsite.
2) A contract signed by the resource and my company.
3) After contracts signed up, I will get a invoice and pay the resource his fixed amount and rest will remain in my business account.

Do you think this is a correct approach ?

[northernladuk]

First question is can you actually do this? Is your client willing to engaged you commercially as you wish? Do they not have a PSL or use an agent?

I'll be willing to bet every single contractor has thought about trying to do this and only a tiny percentage will have managed to do it successfully. It comes with a whole host of responsibilities and risks and the rewards tend not to be worth it. There are so many but a few points are...

You need extra insurances and responsibilities if you are to be the employer.
The resource may let the client down which could fall on you.
You probably don't have the time to deal with issues that might occur.
You won't be making much out of this. If you are your client could be very unhappy if he's getting a cheap contractor and he's paying for an expensive one.
You've got taxes on top of the meagre profit you will be making.
You might need a contract lawyer to write up your contracts.

And so on....

In most cases this just isn't worth it. Why not try just getting a finders fee from your client and then wash your hands of it.

I seriously hope your communications and contracts you offer your client are infinitely better than that post as well!

[TheFaQQer]

I have a requirement from one of my clients where I worked in past, they want a resource for the project and I have a resource to be placed. Now what you think is the best way to place that resource to that company, should I show him as a employee in my company and get a contract signed between my ltd company and the client or should I simply ask him to get a contract signed by his company and give me my share of commission ?

Option 3 - you sign the contract with the client, then sign a contract with his company - so in effect you are contracted to do the work and you have subcontracted it out to another company.

Bear in mind the reporting requirements in this situation.

[gables]

Or find an agent on the PSL (if they have one) with a referral fee paid to you. Might not be much, my last one was £100 voucher from Go Outdoors resulting in a nice jacket.

Anyway with this route you get a jacket and no hassle longer term

[TheCyclingProgrammer]

Don't forget if you do this you'll have to submit reports to HMRC just like agencies do under the new reporting for intermediaries legislation.

[Danglekt]

I have placed someone as a substitute, but they were also a director of myCo too, so it was easy.