I'm inside IR35 but my employee is outside - same contract

[jamesbrown]

Yes if deemed inside it will collapse my company and I will fire him and actually move abroad.

He could do my job but in reality can't because he's already on site doing it. so if I'm sick I can't say I'm sending Employee A as he's already there and can't do two jobs at the same time....

But if he's onsite doing "your job", then you're interchangeable and there's no you-personal service.

[WordIsBond]

Yes if deemed inside it will collapse my company and I will fire him and actually move abroad.

He could do my job but in reality can't because he's already on site doing it. so if I'm sick I can't say I'm sending Employee A as he's already there and can't do two jobs at the same time....

Yes, but that's not actually his point. His point is that if client says, "We want you to do X," and you say, "Well, actually, I'm ill today, I'm going to have my employee do X," and they say, "Fine," substitution just happened. And if they are fine with that substitution, you are outside, even if they are exercising control, etc.

[ladymuck]

At current clientco, I do know they contacted all the firms doing work for them and ask which bodies being supplied were employees and which were via a PSC.

That then informs how they treat the payments.

Obviously in the revised contract will be something indemnifying the client against the firm lying about who is / isn't an employee and maybe (I don't know) they have asked for some evidence of employment.

I would expect your client to do the same or similar.

Therefore, you would continue to pay your employee £100 and charge them out at £1000.

It's still your work for them, whether it requires your personal presence or not etc, that will be most affected.

[northernladuk]

Yes if deemed inside it will collapse my company and I will fire him and actually move abroad.

I believe a couple of posters on here know what to do when being taken to an employment tribunal so when you need help they are here for you.

[pauljh]

Thanks for all the replies peeps. Much appreciated.

[WTFH]

Silly question: is “Employee A” related to you?

[pauljh]

Silly question: is “Employee A” related to you?

if we go back a few millions years yes, but in real terms nope, infact I sponsored him from overseas!

[pacontracting]

if we go back a few millions years yes, but in real terms nope, infact I sponsored him from overseas!

And this is the risk with IR35. People read too much into it wheras in fact, if you take a step back and look at the arrangement (paint a picture if you like), it can't possibly be one of employment.

There are far too many low hanging fruit for HMRC to try to take this arrangement on.

[peche]

But if he's onsite doing "your job", then you're interchangeable and there's no you-personal service.

That’s an interesting point.

Do you think it’s significant that there’s one employee and one director in the relationship with clientco?

In your opinion, would the situation be any different if both workers were working in the same way but instead of director/employee there were two directors or perhaps even a director/subcontractor? By working in the same way I mean two roles/one contract to work in the same team with same client.

Guess there would be no difference, as you can still argue an absence of personal service...

[northernladuk]

Yes, but that's not actually his point. His point is that if client says, "We want you to do X," and you say, "Well, actually, I'm ill today, I'm going to have my employee do X," and they say, "Fine," substitution just happened. And if they are fine with that substitution, you are outside, even if they are exercising control, etc.

Possibly but what we are missing is the details of his contract. If it is two distinct pieces of work under an overarching contract then yes this could be true. It would be interesting to see what the client says when this substitution means his employee isn't working on what he should be doing though.

If it isn't separate work and just a single work package of 8 days a week then it wouldn't substitute but if that is the case is likely not to be an IR35 problem anyway.

Without knowing the minute details of the engagement I don't think we can answer.