Complicated Substitution Situation

[northernladuk]

I have been asked to go to the Middle East for a week, maybe more but I can't go. It would be beneficial for me for future work to be involved and just by pure luck a friend of mine mentioned he would love to go as he has can generate some potential business while he is there.

I mentioned it in passing to my client and lo and behold the client would be ok to send my friend (call him substitution from here on) to do the work. Score!!! I will still work in the UK as normal and will only get my normal billed days though. Now my substitution is willing to go if I put up the cost of the flight, hotels, food and some spending money as it will benefit him to go as well. All looking good.

I expect the client to pay for flights etc but... lets assume worst case he won't. It is still in my best interest to make this happen even taking in to account the costs (to keep the Middle East account which is almost a dead cert to get me extended).

Where do I stand with claiming the flights, subsistance and bit of spend? He does not have a LTD or brolly.

Does he pay for everything then do some kind of invoice to me and I pay it and claim that against the LTD?
Should I pay for everything and he just gives me the receipts and claim those? How do I go about spending money for him?

Do I need a contract in place to make this all above board or is him invoicing me enough?. Is there anything else I need to do to make sure everyone is aware it is someone else doing the work?

I am pretty sure if he can invoice me that would be fairly clean cut. Just want keep this squeeky clean.

Ta

[Craig@Clarity]

I have been asked to go to the Middle East for a week, maybe more but I can't go. It would be beneficial for me for future work to be involved and just by pure luck a friend of mine mentioned he would love to go as he has can generate some potential business while he is there.

I mentioned it in passing to my client and lo and behold the client would be ok to send my friend (call him substitution from here on) to do the work. Score!!! I will still work in the UK as normal and will only get my normal billed days though. Now my substitution is willing to go if I put up the cost of the flight, hotels, food and some spending money as it will benefit him to go as well. All looking good.

I expect the client to pay for flights etc but... lets assume worst case he won't. It is still in my best interest to make this happen even taking in to account the costs (to keep the Middle East account which is almost a dead cert to get me extended).

Where do I stand with claiming the flights, subsistance and bit of spend? He does not have a LTD or brolly.

Does he pay for everything then do some kind of invoice to me and I pay it and claim that against the LTD?
Should I pay for everything and he just gives me the receipts and claim those? How do I go about spending money for him?

Do I need a contract in place to make this all above board or is him invoicing me enough?. Is there anything else I need to do to make sure everyone is aware it is someone else doing the work?

I am pretty sure if he can invoice me that would be fairly clean cut. Just want keep this squeeky clean.

Ta

Firstly, if you are able to send him away as a substitute/subcontract under your current contract then you've just got yourself out of IR35 as you've demonstrated that your personal service is not required.

If you want to take on this substitute, I would either employ him or get him to bill you for his time and spend and you settle the invoice (probably the latter). To protect yourself from any claims on status from him, I would suggest having him come to you either through a brolly or a ltd company himself. You can then bill your client for the time on the contract in the middle east plus expenses to be recharged (if allowable).

[contractoralan]

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[Craig@Clarity]

answer to part of the question on expenses.
It is likely the client will pay for flights, accom etc. otherwise it does not make any finacial sense.
When I asked a question to my accountant on charging the client for expenses , his response :
a) if the client pays direct for flights, accom etc, it makes your life easier - no need to pay from your pocket and claim later.
b) view Your Company 'claiming' the expenses from the client and you claiming the expenses from your company as separate transactions. for eg. the client may be willing to pay only 35p per mile for mileage whereas your company can pay you 40p per mile.

In your situation, you add one more layer to the above arrangement, but the principle will be the same.

a)Just looking at it from an "in business on your own account" and akin to employment, I would say it is better to incur the expenses and then recharge it back to the client rather than have them pay for it direct.

I would say point b) is the better option.