Checklist for IR35 exemption working conditions

[boredsenseless]

So I'm on a 12 month contract, bomb proof outside IR35.

Then in a moment of madness I get a coffee from the staff canteen. Does this make the entire contract outside IR35?! Do I then owe ~15K to the IR?!!

Of course it does !!!!!

[Denny]

Some things make sense, some of it is rubbish.

Real life contracting rules are do what is asked and expected of you and don't be a pain in the arse especially by trying to follow an IR35 checklist of working practices. You may get away with insisting on doing it your way with some clients but a lot will just get rid of you.

If the client gets rid of you simply for following the terms of your contract by acting like a real business on site instead of a pseudo employee then you have grounds for 'obtaining services by deception.'

The only rules a real B2B has is to do the work to time and to do it well, even if it means working with a team of people to get a deliverable out. All other rules are your own not your clients.

[Denny]

Your two number sixes annoy me.

The second one, don't use staff facilities, is surely a crock of tulipe.

If I sign in to a site as a visitor, get a visitors 'credit card' or whatever you call them to use as money on site....then surely I'm allowed to use the staff canteen (as a visitor)

The alternative would be to bill the client for the hour or so that it takes me to walk off-site to the nearest sandwich shop or whatever

If you're hourly paid then you are not acting as a real business and you shouldn't be billing the client for time taken off site to eat whether it's in the staff restaurant or not.

I was referring to regular trips to the canteen on a daily basis as the norm for your usual daily eating practices, not visiting the client site for a specific reason which involves a business meeting over lunch.

[Denny]

So are you really suggesting that as a business you advocate doing extra work for free. If you really ran a business what would your shareholders say about the lost revenue?

I was referring to contractors being paid a daily fee, not IT low level contractors being paid an hourly rate. No real business gets paid by the hour, only temps and casual staff.

[ratewhore]

I get the impression you're putting even more noses out of joint by pontificating about what makes a real business over lowly contractors in pseudo-permie positions.

You should spent more time over at the IoD rather than waste time on the contractor scum who frequent this board because your business is obviously taking over the world...

[Epiphone]

I was referring to contractors being paid a daily fee, not IT low level contractors being paid an hourly rate. No real business gets paid by the hour, only temps and casual staff.

Tell that to a plumber, electrician, decorator etc.

[Denny]

I get the impression you're putting even more noses out of joint by pontificating about what makes a real business over lowly contractors in pseudo-permie positions.

You should spent more time over at the IoD rather than waste time on the contractor scum who frequent this board because your business is obviously taking over the world...

Now, don't be bitter. I'm just trying to put things straight. I'm sure there are more contractors on here to agree with me, than those who have contradicted the advice on this thread.

Look at the IR criteria for real business practices, and you will see that I'm right.

Employee if answering YES to those below:

Do they have to do the work themselves?
Can someone tell them at any time what to do, where to carry out the work or when and how to do it?
Can they work a set amount of hours?
Can someone move them from task to task?
Are they paid by the hour, week, or month?
Can they get overtime pay or bonus payment?

If the answer is 'Yes' to all of the following questions, it will usually mean that the worker is self-employed:

Can they hire someone to do the work or engage helpers at their own expense?
Do they risk their own money?
Do they provide the main items of equipment they need to do their job, not just the small tools that many employees provide for themselves?
Do they agree to do a job for a fixed price regardless of how long the job may take?
Can they decide what work to do, how and when to do the work and where to provide the services?
Do they regularly work for a number of different people?
Do they have to correct unsatisfactory work in their own time and at their own expense?

Most contractors in IT do not seem to fall in the bottom band, it seems to me. Therefore, you need to ensure that you generate IR35 exempt conditions to match the contract terms you have with the EB.

[DaveB]

Tell that to a plumber, electrician, decorator etc.

Not strictly true. Most of them will have an hourly rate they use to produce estimates but the customer rarely if ever sees that.

Those I know that do quote labout costs usually quote for a day or half day rate, not hourly.

The customer just gets the final cost for the job or the bill at the end of it with a break down of the work carried out.

[Pondlife]

One of the suppliers at my current site is a global company with a turnover in excess of $5bln and over 20,000 employees, so no one would ever argue that they are not a 'real' business. According to the OP all consultants/developers on site would would be deemed employees of the client?

1. The supplier invoices based on hours (not days) worked
2. The guys on site have to be approved (CV/profile reviewed) i.e. we're not paying £x per hour to train some graduate.
3. They all use the staff canteen
4. Certain key personel have to be on site (and working the same hours as the client) during various phases of the project.
5. They work on client owned systems accessed via client machines.
6. They fill in timesheets.

This is common on large scale projects but certainly doesn't mean that they are deemed employees of the end client.

[ratewhore]

Now, don't be bitter. I'm just trying to put things straight. I'm sure there are more contractors on here to agree with me, than those who have contradicted the advice on this thread.

Look at the IR criteria for real business practices, and you will see that I'm right.

Employee if answering YES to those below:

Do they have to do the work themselves?
Can someone tell them at any time what to do, where to carry out the work or when and how to do it?
Can they work a set amount of hours?
Can someone move them from task to task?
Are they paid by the hour, week, or month?
Can they get overtime pay or bonus payment?

If the answer is 'Yes' to all of the following questions, it will usually mean that the worker is self-employed:

Can they hire someone to do the work or engage helpers at their own expense?
Do they risk their own money?
Do they provide the main items of equipment they need to do their job, not just the small tools that many employees provide for themselves?
Do they agree to do a job for a fixed price regardless of how long the job may take?
Can they decide what work to do, how and when to do the work and where to provide the services?
Do they regularly work for a number of different people?
Do they have to correct unsatisfactory work in their own time and at their own expense?

Most contractors in IT do not seem to fall in the bottom band, it seems to me. Therefore, you need to ensure that you generate IR35 exempt conditions to match the contract terms you have with the EB.

It's not bitterness at all as I happen to agree with (some of) what you say. However, what you say regularly does not match the reality of life for many contractors here and if they try to follow this advice they don't get the gig.

There is a problem but it's a much bigger problem than simply saying 'you're a pseudo-employee not a real business' so change your working conditions...