Who is liable for IR35 in this scenario?

[MarkA]

Let's say there's me, with my limited company, contracted via a standard agency. Normally I would then be working for another company.

Me->MyCompany->Agent->Company


However, the situation I'm being offered is that the end company is themselves hiring me out to another company

Me->MyCompany->Agent->CompanyA->CompanyB

So in the situation where the company now makes and is liable for IR35 determination, which company needs to do this, CompanyA or CompanyB?

Thanks

[hobnob]

I think it depends on how company A operates. E.g. are they another agency or a consultancy?

This thread might help:
When do end-clients have to and not have to determine IR35 status? - Contractor UK Bulletin Board

[northernladuk]

Depends on the nature of the engagement between Company A and Company B. The fee payer is responsible. If A is a consultancy offering a package of work inc you to Company B then it's going to be B. If A are just taking a cut to move you up the chain to be a bum on seat at B then I'd say B.

Either way, company A or B should be aware of their responsibilities. Shouldn't be up to you to understand the chain. I'd ask the agent to ask A to see what they say. If A says they've no idea then there is a problem here that's not yours but needs sorting.

[jamesbrown]

Let's say there's me, with my limited company, contracted via a standard agency. Normally I would then be working for another company.

Me->MyCompany->Agent->Company


However, the situation I'm being offered is that the end company is themselves hiring me out to another company

Me->MyCompany->Agent->CompanyA->CompanyB

So in the situation where the company now makes and is liable for IR35 determination, which company needs to do this, CompanyA or CompanyB?

Thanks

It is extremely unlikely that CompanyA is providing CompanyB with a fully contracted our service, rather CompanyA is providing your labour to CompanyB. In that case, Company B is responsible for the Status Determination Statement and Agent is liable as Fee Payer, in the first instance.

In the (again, extremely unlikely) event that Company A is providing a fully contracted out service to Company B, then CompanyA is responsible for the SDS and Agent is liable as Fee Payer, in the first instance.

What is a fully contracted out service? If you are working onsite at CompanyB, alongside CompanyB's staff, it is a labour supply, not a fully contracted out service.

[MarkA]

Thanks very much for all the information folks, lots to read and digest.

The situation I was in was that CompanyB, the end client, was expecting me to be inside, but CompanyA didn't mind either way.

Thanks again.

[WTFH]

Thanks very much for all the information folks, lots to read and digest.

The situation I was in was that CompanyB, the end client, was expecting me to be inside, but CompanyA didn't mind either way.

Thanks again.

Did you know that when you made the first post?

I'd argue that if the company where you are delivering the work says you are inside, then you're inside.
In fact, I'd expect the HMRC attitude would be if any part of the chain says you're inside, then you're inside. It's only if everyone says you are outside that HMRC might consider you to be outside.

[northernladuk]

Thanks very much for all the information folks, lots to read and digest.

The situation I was in was that CompanyB, the end client, was expecting me to be inside, but CompanyA didn't mind either way.

Thanks again.

Would have been nice if you had shared that with us at the beginning so we could give you better advice. If the Company B wants you inside you are inside. They consider themselves the fee payer so have final say. Company A didn't care as it's not their responsibility.

[jamesbrown]

It's moot, CompanyB will be responsible for the SDS in any case (the fact that CompanyB has an opinion about IR35 at all reveals that it's definitely not a fully contracted out service), and you already have your answer about the IR35 status, it's inside. The Fee Payer is companyA in all scenarios.

I suppose it does add some context to your OP, though. Essentially, you were asking "can I get away with an outside IR35 determination on a technicality?" without revealing that to be the true question. The answer to this was always no, hidden or otherwise. Your contract is inside IR35 and your end client responsible for the SDS is CompanyB. CompanyA is liable in the first instance. End of story.