Reply to: Double Question

[northernladuk]

He probably can't as am sure handcuffs will come in to play somewhere but it's just not worth going in to.

[WordIsBond]

To be fair i thought the benefit to me would show HMRC i'm more than a one man bamd, and the person in question is an American and might not be in the UK much longer so didn't want to setup there own company. I would be more of doing them a favour. So maybe its not worth it then!

You do a favour only if it strengthens your business.

For instance, you do this as a favour to your client if they are having trouble filling a need and you know someone who can help out, and it is easier for them if they do it through you. Or you do it as a favour to the guy if he's going to be a contact that is going to help you get contracts down the road.

You CAN do a favour for a personal friend, but just be prepared to have it cost you your own contract and business relationship if things go pear-shaped. If his friendship is worth that risk to you, go for it!

[TheCyclingProgrammer]

But he's not really is he. He's just trying act like an agent and skim a little off some poor unsuspecting umbrella guy.

I don't think OP made it clear so I have no idea why they want to do it.

EDIT: ok, I missed their subsequent post. Probably not worth bothering with.

[northernladuk]

Oh and regarding taking on a sub-contractor for a project - no real legal issues I can think of but if you're on the FRS you won't be able to reclaim any VAT they charge you which could take off a big slice of any "profit" you can make from the fee you charge your end client.

But he's not really is he. He's just trying act like an agent and skim a little off some poor unsuspecting umbrella guy.

[TheCyclingProgrammer]

Oh and regarding taking on a sub-contractor for a project - no real legal issues I can think of but if you're on the FRS you won't be able to reclaim any VAT they charge you which could take off a big slice of any "profit" you can make from the fee you charge your end client.

[TheCyclingProgrammer]

Regarding the TV thing, its perfectly legitimate if its something you genuinely need for your business and you're not buying it for any other purpose.

The issue with working from home is if you buy something like a TV that can clearly have a dual purpose, then its likely to raise some eyebrows if HMRC do an inspection - so be prepared to justify its purchase.

Clearly this is much easier to do if you don't work from home and rent an office - you can leave the TV at the office and the question of dual purpose is unlikely to come up.

But if you think its justifiable, then keep some documentation about your current project that you could use to demonstrate to HMRC that it was solely bought for business purposes if the question comes up.

The other thing to bear in mind is that even if you could show that it was bought "wholly and exclusively" for business purposes the asset is still being placed at your disposal so you would also have to show that there is no personal use or that any personal use is "not significant" or you could be liable to a BIK.

TLDR; for an easy life, don't bother, but if you can genuinely justify it then get it.

[NotAllThere]

I guess i could use a smaller 4k display but wanted to demo it, then i could use the screen for trade shows afterwards

It's a business decision. Is it a good investment for your business. And even if it's not, so long as you only use it for business purposes, I really can't see an issue.

If you want a big screen to watch stuff on I recommend a TV projector. 4.5m screen. Watch 2001, Space Odyssey on Bluray on it...

[northernladuk]

Business don't do people favours, charities do. HTHBIDI

The missus makes her living running a business that does people 'favours'.....

[LondonManc]

To be fair i thought the benefit to me would show HMRC i'm more than a one man bamd, and the person in question is an American and might not be in the UK much longer so didn't want to setup there own company. I would be more of doing them a favour. So maybe its not worth it then!

Business don't do people favours, charities do. HTHBIDI

[Fred Bloggs]

To be fair i thought the benefit to me would show HMRC i'm more than a one man bamd, and the person in question is an American and might not be in the UK much longer so didn't want to setup there own company. I would be more of doing them a favour. So maybe its not worth it then!

It's irrelevant, every contract is assessed on its own merits. If you have two contracts you can be in and out of IR35 at the same time.

[dannywooly77]

To be fair i thought the benefit to me would show HMRC i'm more than a one man bamd, and the person in question is an American and might not be in the UK much longer so didn't want to setup there own company. I would be more of doing them a favour. So maybe its not worth it then!

[northernladuk]

Thanks for the info guys, so looks like i'd be best to use the TV in the lounge for dev work testing and skip buying another.

And yes it would be a simple pass through to a client, the person in question has to work through an agent and is currently getting milked! I just offered up to look into having them work through my business. But wasn't sure it was a good idea or not.

To be honest that is his problem. If he's not got it about him to change that I wouldn't be having him anywhere near my business on top of everything else been said.

[LondonManc]

Thanks for the info guys, so looks like i'd be best to use the TV in the lounge for dev work testing and skip buying another.

And yes it would be a simple pass through to a client, the person in question has to work through an agent and is currently getting milked! I just offered up to look into having them work through my business. But wasn't sure it was a good idea or not.

They'll still have to go through an agent and will still be on the same day rate, brolly or ltd, so they're better off setting up their own ltd.

Unless you're saying that the brolly is creaming a lot off?

[dannywooly77]

Thanks for the info guys, so looks like i'd be best to use the TV in the lounge for dev work testing and skip buying another.

And yes it would be a simple pass through to a client, the person in question has to work through an agent and is currently getting milked! I just offered up to look into having them work through my business. But wasn't sure it was a good idea or not.

[LondonManc]

Don't bother bringing people in under your LTD. It just isnt worth the hassle. At best you skim a bit off the top at worst you both get binned if he screws up or if the client changes his mind. It seems very tempting but the risk tends to far outweigh the benefits.

A 2k piece of kit for developing one dash board... Damn right HMRC will immediately think you are taking the piss. If there is the alight chance that you aren't you are still going to have to defend it. How lucky do you feel?

This in general. Don't act as an umbrella, but if you're acting as a small consultancy, that's fine. That is, if you're just getting a small admin fee of the person, don't bother (unless your accountant suggests otherwise). If you're acting as a small consultancy and can charge, say, £700/day for a guy who's invoicing £500/day to you, then it's worth it. Make sure your contract with them is a business to business contract with relevant payment terms (I expect to be paid month in arrears when on B2B - better rate but higher risk); you would need a contract with client co in this situation but in the example you're talking about, you'd need one via an agency, leaving you with little or no margin.