Contracting via consultancy

[jamesbrown]

Seems there is a degree of disagreement on this thread!

My problem is that I have a cristal clear outside IR35 relationship with the consultancy. No control, no tools, no direction, no benefits whatsoever, very little interaction with them to be honest and Ill probably only be here for the one project.

But with the end client I feel like I'm sailing slightly close to the wind.

A key question to resolve. I'll look into the cases mentioned and report back...

You might not get any more resolution than the above posts, I'm afraid. As I said, I'm in a very similar position based on what you've written - almost zero interaction with the consultancy - but I take care with both relationships, and the advice I've been given (from well-known folks advising on IR35) is that the direct client (consultancy) is the relationship that matters w/r to IR35. I'm not aware of anything that would prevent HMRC pursuing whatever they want; whether it stands up is a separate question.

[LisaContractorUmbrella]

3rd part as in your clients client? I think you would be surprised. These consultancies often throw a couple of heads in positions that are nothing to do with the original service contract and then let their client do with them as they wish. They can't turn down the extra revenue for that head, particularly when firms are trying to cut head count and hide them in a managed service contract. If that odd person is beyond the original scope of the contract between the two business they can be left to do as the end client bids.

Sorry no I meant third party as in the intermediary i.e. the consultancy - surely the sd&c would have to come from the end client i.e. the person who you are actually physically working for and therefore the only person who can, in reality, direct you in terms of what they want doing, supervise you to make sure you do it and control you to make sure you don't do anything else. The consultancy would farm you out to the third party but beyond that has no real control over what you do regardless of what may or may not be stated in the contract.

[jamesbrown]

Sorry no I meant third party as in the intermediary i.e. the consultancy - surely the sd&c would have to come from the end client i.e. the person who you are actually physically working for and therefore the only person who can, in reality, direct you in terms of what they want doing, supervise you to make sure you do it and control you to make sure you don't do anything else. The consultancy would farm you out to the third party but beyond that has no real control over what you do regardless of what may or may not be stated in the contract.

But you're not contractually obligated to the client's client. If you didn't have an appropriate B2B relationship with the consultancy for a particular project, they could pull you from their client at any time to do whatever they wanted. I think the greatest risk lies with the relationship to the consultancy, although I think it pays to treat both as clients for the specified deliverables in practice (and not treat the client's client or anyone else down the chain like an employer).

[northernladuk]

Sorry no I meant third party as in the intermediary i.e. the consultancy - surely the sd&c would have to come from the end client i.e. the person who you are actually physically working for and therefore the only person who can, in reality, direct you in terms of what they want doing, supervise you to make sure you do it and control you to make sure you don't do anything else. The consultancy would farm you out to the third party but beyond that has no real control over what you do regardless of what may or may not be stated in the contract.

That is the interesting point and the reason I started my other thread. It is often the case the 3rd party has nothing to do with you once you are working yes but IR35 is to determin your employment status i.e. hidden... but you are not an employee of the end client at all, permie, hidden, nothing. The scope of your work would be defined by the 3rd party, your pay, time tracking, etc and their direction is to attend their client and fulfil the scope of work on your contract.

The difference between a consultancy and agent is that you are not always farmed. I attend 3rd party's site for project review, they have functions for all permies at this account to which I am excluded etc. I can prove I am working for the 3rd party but not directed by them so I feel comfortable (plus, as said before, I have limited risk at end client as well).

Tis a complicated interesting situation though I admit....