Trying to arrange a substitute

[BlasterBates]

This would work if:
1. The contractor had a previous contract where he needed to work from the office a significant amount of time as the client didn't provide facilities for him to work on the client-site.
2. The contractor was in a lease/rental agreement which his business couldn't get out of and extended into the period covering the next contract.

Otherwise HMRC would say it's a sham to get around their tests.

A special commissioner decided in favour of a contractor being outside IR35 and having an office was part of the reasoning even though the contractor did have workplace at the client.

[MyUserName]

When thinking about this sort of thing think 'What would IBM do?' (apart from balls it up).

If you hire them as a consultancy and ask them to provide one resource they will provide one.
They might change who you are getting if they have to but the guy they change him with will be just as good.

What they will not do is send one different guy in for one day of a 6 month contract purely to say that they have, they will not rent an office nearby that they do not use just to say that they have it. Businesses do not do that, disguised employees do that and HMRC love it when they try.

What happens if you sham a sub in for a day and HMRC challenge it in court as elaborate tax avoidance and, after reviewing the facts, a judge agrees. Wouldn't that establish case law that a substitute does not mean you are outside IR35 and cause problems for everyone else? (IANAL - genuine question here)

[FiveTimes]

I just can't see the point of this. If that contractor is unavailble due to him having another contract it just won't work. It also doesn't mean you can use him as your sub clause will need your client to meet him. To have a valid named sub in a contract you need to have had him vetted by the client else it's just rubbish surely. Think about all these 'tricks' from HMRC's point of view. How easy will it to be to prove it's a sham. In this, the office and all the other manufactured situations it will be a peace of piss.

The guy I am thinking of using isnt working. Has worked at current clientco before and is well known there. Has done the work before and could just drop right it.

Im only floating the idea to see the reactions.

[MyUserName]

The guy I am thinking of using isnt working. Has worked at current clientco before and is well known there. Has done the work before and could just drop right it.

Im only floating the idea to see the reactions.

Can it be twisted to make it look like tax avoidence - if it can then probably is.

If not then you have nothing to worry about - go for it!

[BlasterBates]

Lets put it this way it isn't going to you any harm, the worst that can happen is that HMRC would argue that it would be irrelevant. Now what matters is not what HMRC think and assuming it's a sham, what matters is the Special Commissioner, and in the past he has sometimes taken a different view. I would have thought a named individual would strengthen the argument.

[BlasterBates]

Can it be twisted to make it look like tax avoidence - if it can then probably is.

If not then you have nothing to worry about - go for it!

What you don't have to worry about is HMRC accusing you of "tax avoidance" and artificial constructs. That's not how it works, you're not operating an Isle of Man scheme, you merely have a legitimate clause in your contract that names a sub. The worst that can happen is that HMRC say it's irrelevant. So it won't do you no harm, but it might help.

[Butcheroo]

Trying to arrange a substitute

I just can't see the point of this. If that contractor is unavailble due to him having another contract it just won't work. It also doesn't mean you can use him as your sub clause will need your client to meet him. To have a valid named sub in a contract you need to have had him vetted by the client else it's just rubbish surely. Think about all these 'tricks' from HMRC's point of view. How easy will it to be to prove it's a sham. In this, the office and all the other manufactured situations it will be a peace of piss.

But on HMRCs own ir35 example one of them specifically says a guy passed as he has named agreed subs but never used them. Just quoting hmrc examples fella

[northernladuk]

But on HMRCs own ir35 example one of them specifically says a guy passed as he has named agreed subs but never used them. Just quoting hmrc examples fella

You are quoting a tiny paragraph from what probably was a very complex investigation based on a whole host of points and haven't even named the case. There is no silver bullet for IR35. No one element can put you in and no one element can put you out. I do not believe that him having a named sub was the one thing that won him this case. You are missing a whole load of context and quoting one line which is incredibly misleading. You are quoting lines, not HMRC case law.

[captainham]

But on HMRCs own ir35 example one of them specifically says a guy passed as he has named agreed subs but never used them. Just quoting hmrc examples fella

Yes but the client has already agreed this, and the named sub:

"The end client accepts that H Ltd is free to send someone to take Hamish’s place."

If you can get that in a contract, great, but in reality I don't think many clients will accept that, unless you already have a very good relationship with them.

Edit: Context

‘Hamish’ – reasons why IR35 does not apply
Personal service
Even though H Ltd has not sent a substitute, it is clear that there is no need
for Hamish to provide personal service. The end client will accept a substitute,
and H Ltd has named two suitable substitutes.
IR35 cannot apply unless the end client needs the worker’s personal service.
That is clearly not the case here. This is a clinching argument that IR35 does
not apply.

Other factors
H Ltd spends a lot of money on providing and maintaining the equipment
needed for the work. H Ltd thus incurs financial risk. This is a strong pointer
that IR35 does not apply.

[Butcheroo]

Trying to arrange a substitute

You are quoting a tiny paragraph from what probably was a very complex investigation based on a whole host of points and haven't even named the case. There is no silver bullet for IR35. No one element can put you in and no one element can put you out. I do not believe that him having a named sub was the one thing that won him this case. You are missing a whole load of context and quoting one line which is incredibly misleading. You are quoting lines, not HMRC case law.

Fair enough

Your point of stop trying to look like a business just be one, is the whole game we are all playing now

We can't be hidden employees as we have no employee rights and I personally change client every few months, what permy does that

Even if we think we are a business and have ir35 proof contract terms we are still vulnerable so are looking for helping hands even if they are forced changes to look better

I will do anything to avoid this mad witch hunt.