Agency - Single Shareholder

**Milkyway** · 29 March 2016, 18:37

Originally posted by AGFR83 View Post

Hi All..

New to the forum... be gentle..

About to sign a contract with a bank via their chosen 3rd party consultancy firm, looking through the paperwork and there is a pre-approval letter I need to sign which has left me confused.
2 Points requested :

- 'A letter from your company accountant confirming the company is IR35 Compliant'
- 'Sign to confirm you are the only shareholder of your company. (Failure to do so can result in contract termination, without notice)

First one is fine, although confusing i'll get the contract reviewed for them..
Second one.. has anyone else heard of this? Spouse is a shareholder, which i've advised but had no response.

Any feedback welcomed... ta

No wonder bankers are crazy.
They are expecting a company to be IR35 compliant????

IR35 compliance is on a per contract basis, and even then the COMPANY cannot be compliant.
Its about the contract between the company and your silly bank client, and the working practices you BOTH have in place.

First of all you should tell them that no matter what you do from your part to be IR35 compliant in terms of the working practices, if the end-client i.e. this bank of yours - if they don't support such compliant working practices, you will not be IR35 compliant.
I find it hard that clients expect contractors to be IR35 compliant, but will never co-operate with the working practices, unless you bend their hands too much - which IMO is very difficult to do with banks - since they will say if you don't agree to the contract, there will always be someone else who will. So feel free to walk!

To be honest, you should ask them in writing to say they will co-operate to let you practice IR35 compliant working practices first, before your company can say so.

Also, they expect your ACCOUNTANT to certify that you are IR 35 compliant???
Banks are clearly not a place to contract with!!!

As for the second condition (only one shareholder), if I were you, I will walk away from the contract.
So, essentially they are trying to have full control over not only you, but also in the way your company's shareholder structure is to be setup??
I am speechless! To me, that alone straight away fails IR35 in my books. They seem to have too much control over you, even before starting the contract

Are banks really this crazy??? or are you just trolling?

**AGFR83** · 29 March 2016, 20:01

Thank you for your reply, you've re-iterated my thoughts and concerns!

No trolling haha one of the bigger banks, using their preferred consultancy firm.

Wording suggests they do not want to be held responsible for any Tax/NI implications but again that's my concern not theirs

Originally posted by Milkyway View Post

No wonder bankers are crazy.
They are expecting a company to be IR35 compliant????

IR35 compliance is on a per contract basis, and even then the COMPANY cannot be compliant.
Its about the contract between the company and your silly bank client, and the working practices you BOTH have in place.

First of all you should tell them that no matter what you do from your part to be IR35 compliant in terms of the working practices, if the end-client i.e. this bank of yours - if they don't support such compliant working practices, you will not be IR35 compliant.
I find it hard that clients expect contractors to be IR35 compliant, but will never co-operate with the working practices, unless you bend their hands too much - which IMO is very difficult to do with banks - since they will say if you don't agree to the contract, there will always be someone else who will. So feel free to walk!

To be honest, you should ask them in writing to say they will co-operate to let you practice IR35 compliant working practices first, before your company can say so.

Also, they expect your ACCOUNTANT to certify that you are IR 35 compliant???
Banks are clearly not a place to contract with!!!

As for the second condition (only one shareholder), if I were you, I will walk away from the contract.
So, essentially they are trying to have full control over not only you, but also in the way your company's shareholder structure is to be setup??
I am speechless! To me, that alone straight away fails IR35 in my books. They seem to have too much control over you, even before starting the contract

Are banks really this crazy??? or are you just trolling?

**m0n1k3r** · 30 March 2016, 11:28

Originally posted by AGFR83 View Post

Thank you for your reply, you've re-iterated my thoughts and concerns!

No trolling haha one of the bigger banks, using their preferred consultancy firm.

Recruiter or consultancy? Recruiters tend to want to call themselves 'recruiter' but they are nothing like a proper professional services firm.

**northernladuk** · 30 March 2016, 11:47

Very frustrating when you are asked to sign stuff that doesn't even make sense.. and the second one... Jeez...

Just make sure you've https://www.ipse.co.uk/join/IPSEMGM1094 in case any of their cover will help in this situation. Should really be a no brainer regardless TBH.

**BigRed** · 30 March 2016, 11:51

Is this their attempt to avoid responsibility if HMRC decide you are a disguised employee? I know they have got it all wrong but that shouldn't be a surprise.

**m0n1k3r** · 30 March 2016, 12:03

Originally posted by BigRed View Post

Is this their attempt to avoid responsibility if HMRC decide you are a disguised employee? I know they have got it all wrong but that shouldn't be a surprise.

Having more than one shareholder, or having the person performing the services not be a director of the company poses far lower risk to them. Their requirements ('your own company', 'only shareholder', 'must be director') increases their risk significantly and is the worst thing they can do to manage risk.

I take it then that they won't contract with umbrellas, as you are effectively a regular employee of the umbrella and neither a director nor a shareholder.

**AGFR83** · 30 March 2016, 15:11

Thank you for this, really useful I will sign up

.

Update

Lady onboarding for the consultancy firm said they're 'paranoid about IR35' so wants me to have the contract independently reviewed before signing.. strange but something I would do anyway.
Re: shareholders, couldn't give any indication why this was necessary and has removed it from the paperwork.

Originally posted by northernladuk View Post

Very frustrating when you are asked to sign stuff that doesn't even make sense.. and the second one... Jeez...

Just make sure you've https://www.ipse.co.uk/join/IPSEMGM1094 in case any of their cover will help in this situation. Should really be a no brainer regardless TBH.

**TheFaQQer** · 30 March 2016, 16:01

Originally posted by AGFR83 View Post

Lady onboarding for the consultancy firm said they're 'paranoid about IR35' so wants me to have the contract independently reviewed before signing.. strange but something I would do anyway.

In that case, you could ask them how much they are going to pay for that to happen - you never know, they might stump up some cash to do it.

The IPSE contract review service does more than just IR35 checks, it's a full commercial contract review - a fast-track service is available too. Although I've not used it myself (I've been in the same contract since before they started the service), those that have used it have given very positive feedback.

Agency - Single Shareholder