Is anyone using a contrived agency contract?

[malvolio]

It doesn't matter who they claim it is targetting. Once on the book it applies to everyone.

Before claiming the sky is falling, perhaps have a read of this article?

I remain unconvinced, but we have to start somewhere...

[LisaContractorUmbrella]

It doesn't matter who they claim it is targetting. Once on the book it applies to everyone.

Yes but the 'book' is the The Social Security (Categorisation of Earners) (Contributions) (Amendment) Regulations 2014 and the changes that are being made will bring sole traders who are 'subject to ..control, supervision or direction as to the manner in which their duties are carried out' into the realms of employment, for tax purposes, rather than self-employment. Basically the same rules that IR35 applied to PSC's

[GB9]

Before claiming the sky is falling, perhaps have a read of this article?

I remain unconvinced, but we have to start somewhere...

Hypothetical situation:

You get offered a contract but there is no substitution clause. You request one but are told "no" as there is no clause in the upper contract and putting one in would deem the contract as contrived.

At present the agent won't care what is in as it won't impact them. In future it will.

What are you going to do? HMRC may not have targetted this but it looks like he outcome.

[LisaContractorUmbrella]

Hypothetical situation:

You get offered a contract but there is no substitution clause. You request one but are told "no" as there is no clause in the upper contract and putting one in would deem the contract as contrived.

At present the agent won't care what is in as it won't impact them. In future it will.

What are you going to do? HMRC may not have targetted this but it looks like he outcome.

But if there was no ROS clause in the upper contract you would have fallen inside IR35 anyway as, realistically, you would not be permitted to provide a substitute - nothing's changed

[GB9]

But if there was no ROS clause in the upper contract you would have fallen inside IR35 anyway as, realistically, you would not be permitted to provide a substitute - nothing's changed

That isn't strictly true but that's another matter.

I bet there are plenty of contracts where the lower contract has a ros but that isn't reflected upwards. This still gives the contract an IR35 pass at review.

Under the new rules will those contracts be the same? I doubt it as it will then impact the agency.

[LisaContractorUmbrella]

That isn't strictly true but that's another matter.

I bet there are plenty of contracts where the lower contract has a ros but that isn't reflected upwards. This still gives the contract an IR35 pass at review.

Under the new rules will those contracts be the same? I doubt it as it will then impact the agency.

It might give what's written on a piece of paper a pass for IR35 but working practices would put you inside - I would imagine agencies will do what they can to minimise risk but this change in legislation doesn't compel them to do anything with regard to PSC's

[DirtyDog]

But if there was no ROS clause in the upper contract you would have fallen inside IR35 anyway as, realistically, you would not be permitted to provide a substitute - nothing's changed

No, you would fail one out of the three tests that you need to be able to pass - as long as you can prove either lack of MOO or lack of D&C then you are outside IR35.

[LisaContractorUmbrella]

No, you would fail one out of the three tests that you need to be able to pass - as long as you can prove either lack of MOO or lack of D&C then you are outside IR35.

I think you'd have to pass more than one to satisfy HMRC

[GB9]

It might give what's written on a piece of paper a pass for IR35 but working practices would put you inside - I would imagine agencies will do what they can to minimise risk but this change in legislation doesn't compel them to do anything with regard to PSC's

I have provided a sub when there wasn't a ros in the final tier of contract so nothing is as straight forward as you might think.

However, the risk in paying NI under the new rules has moved closer to the agent.

[TheCyclingProgrammer]

But if there was no ROS clause in the upper contract you would have fallen inside IR35 anyway as, realistically, you would not be permitted to provide a substitute - nothing's changed

Lack of ROS is not an automatic IR35 fail. Why would you say that? It's just one pointer. You would also need to fail on MOO and Direction and Control.