Deemed employment?

[chicane]

I've found myself in a situation with my current client where the end client is taking time to approve delivarables, resulting in gaps of 1-2 weeks during the contract where I'm twiddling my fingers doing very little.

My client obviously doesn't like paying for me to do nothing, so has suggested that I work on other projects during these gaps - the current suggestion being two small projects of a week each starting next week. From a practical standpoint, I've no objection to doing this, but I'm thinking it's somewhat dangerous from a tax perspective as I'll then be viewed as being in deemed employment.

I've suggested to my client on this occasion that the current agency contract is terminated, and a new two week contract is commenced naming the two projects and how much time will be spent on them, after which I'll start another contract that names the original client and the anticipated length in time of the remainder of the project.

1) Is all this effort necessary or am I overstating the risk?
2) What case can I put forward to my client to justify all this effort?
3) Are there any viable alternative courses of action?

[jh0711]

i would say you would need to negotiate a new contract - or at the very least get an addendum to the current contract.

If you current contract only mentions the main project you were working on then like any business you need to get a new contract confirming the new work and new deliverables.

if the end client genuienly sees you as a buisness partner and not a disguised employee then they should have no problems with a new/updated contract.



probably

[chicane]

I believe my current contract doesn't even state the name of the end client, which probably doesn't put MyCo in a very clever situation. All the more reason to move to a more specific contract ASAP I imagine...

[Bluebird]

I believe my current contract doesn't even state the name of the end client, which probably doesn't put MyCo in a very clever situation. All the more reason to move to a more specific contract ASAP I imagine...

are you working direct or through an agency ?

[chicane]

Through an agency.

Diolch yn fawr.

[Bluebird]

then you should change your contract with the agency - the end client need not be involved.

as a matter of interest however I'm sure there's some IR regs about "changing a contract to fit the change of duties"

i.e. just cos you change your contract doesn't ,ean that you avoid IR35 - don't forget it's about the "way" you work not the "way" you're contracted.

You may be better off taking a week or 2 off.

[chicane]

as a matter of interest however I'm sure there's some IR regs about "changing a contract to fit the change of duties"

I think I can see where you're coming from - if I was to terminate my current contract, have another 2 week contract on another job for the same client, followed by a return to the original job on a further contract, this would just be seen as a flaky ongoing attempt to change the contract to suit the working conditions and therefore disguise what is in effect deemed employment.

Further to this, I've discovered in recent weeks that my client believe me to be a temp resource rather than a contractor on a specific project - not ideal from an investigation perspective.

Think I may indeed need to take a couple of weeks off or go find another client to work for.