New Contract Request supposed 'Legal Requirement' for tax help

[Dilvid]

Hi all,

Bit of a strange one, I've been contracting with my current Ltd company now for about 3-4 years. Prior to that I was contracting for 5 years via another Ltd company (took a break and tested the perm side again, didn't like it haha). I had closed my original Ltd company down all fine and when I decided to go back contracting again we decided to use my partners Ltd company to save on accountancy fees and didn't bother putting my name officially on company so it appears in Companies House. I am a Director in title, can sign on the bank accounts etc but I just don't appear in Companies House. Being blunt it's set up like a large company, the owner will appear in registration on CH but say their Sales Director won't appear. He's still a director but in title only.

Now to the issue. I've ran a few contracts via this Ltd company and all has been fine. No one has mentioned anything but I've just come to sign up a new contract and they are saying for legal reasons (tax specifically) I am required to be listed on the CH website as a Director. Never come across this before and with the agency trying to bully me into adding myself to the company (which I'm fine with but just waiting on advice from my accountant re current setup and what would change) I thought I'd ask about.

I already asked one of the agencies I'm friendly with and he says its just their Terms and nothing legal.

Any ideas/advice would be appreciated.

[NotAllThere]

They're trying to ensure they don't end up liable for your tax - various reasons why they might think this (or their legal advisers). But if you're at the stage of signing the contract, they won't want to lose the money you could earn for them, so unless it's a bum-on-seat contract, they'll capitulate. Just tell them you've taken legal advice, and you know that this is just their policy, not a legal requirement, and suggest to your agent that he escalate it to someone with the authority to override the policy.

[northernladuk]

Get your company affairs in order and carry on as normal?

A director of a company and an employee of a company with the title of a director are quite different things.

[Lance]

Director in name only and not listed at CH is not a director. Just complete a 288 form and get your partner to confirm it.

[Dilvid]

Get your company affairs in order and carry on as normal?

A director of a company and an employee of a company with the title of a director are quite different things.

Not according to this site.... When a director is not a director :: Contractor UK

[northernladuk]

Not according to this site.... When a director is not a director :: Contractor UK

That's very nice. So do you have a contract of employment outlining your roles and responsibilities etc?

It's quite understandable an agency that deals with a normal situation of single directors of Ltd companies aren't willing to just accept an signature or agreement with someone who just calls themselves directors. We are talking about contracts worth potentially hundreds of thousands of pounds here.

In theory NAT is right but agents are just no good at this type of thing. Even if you set it all up nicely with the right directors and 50% shareholdings the agents struggle with it.

http://forums.contractoruk.com/busin...rship-ltd.html

Choice is either to fight them as NAT says or just do it like everyone else (and as the agency expect) and avoid all these problems.

[ladymuck]

Would they accept your partner signing the contract on behalf of the company? If they want a true director to sign and confirm they take responsibility for the taxation, that should do the trick?

It does annoy me that agencies are so dumb as to not understand these things. They want to engage a business to supply a body for a job, why should they care if that body is a director or not? Most contractors were forced down the LtdCo router because self employment is "risky" and yet when two or more people organise themselves into a business they get the arse about that too.

In reality, you may have to capitulate but it annoys me greatly that a perfectly legal arrangement is beyond their capacity to cope with.

[northernladuk]

Would they accept your partner signing the contract on behalf of the company? If they want a true director to sign and confirm they take responsibility for the taxation, that should do the trick?

It does annoy me that agencies are so dumb as to not understand these things. They want to engage a business to supply a body for a job, why should they care if that body is a director or not? Most contractors were forced down the LtdCo router because self employment is "risky" and yet when two or more people organise themselves into a business they get the arse about that too.

In reality, you may have to capitulate but it annoys me greatly that a perfectly legal arrangement is beyond their capacity to cope with.

I'd agree in a perfect world but you've seen how badly some LTD's are run for evidence on here alone. Maybe the OP's isn't badly setup but it's far from ideal so you can see why the agent's don't want to have to deal with each and every situation that is not the 'norm'. There are probably plenty of real shambles setup which leaves the agent far too exposed. There are plenty of people that have a norm setup so they just do business with them and forget the rest..

[Lance]

Would they accept your partner signing the contract on behalf of the company? If they want a true director to sign and confirm they take responsibility for the taxation, that should do the trick?

It does annoy me that agencies are so dumb as to not understand these things. They want to engage a business to supply a body for a job, why should they care if that body is a director or not? Most contractors were forced down the LtdCo router because self employment is "risky" and yet when two or more people organise themselves into a business they get the arse about that too.

In reality, you may have to capitulate but it annoys me greatly that a perfectly legal arrangement is beyond their capacity to cope with.

Another reason they won't like it is it not possible for them to enforce a non-poaching clause on the contractor if they're not a company official.