Reply to: substituting

[eek]

And did we?

+1 - ensignia where on this thread have we mentioned anything about your pet topic (tis irrelevant here so we haven't)

[northernladuk]

Well, it's an inevitability at this stage. Any time anyone mentions they are operating Outside, you, eek or one of the other bores will throw this in.

And did we?

[ensignia]

Yawn.Change the record. You call other people for posting the same thing over and over again and you are the worst for it.

Well, it's an inevitability at this stage. Any time anyone mentions they are operating Outside, you, eek or one of the other bores will throw this in.

[jamesbrown]

No, not at all. As I (and eek) have said, the substitute takes over the entirety of the contract, other than where the resultant income goes. It is not a temporary stand in (other than you can always revert back to status quo ante when you are available yourself again) nor is it a sub-contractor of YourCo.

Refer back to RMC where there was endless debate on this point - the final outcome was that using another driver in your truck was not substitution, giving your contract for that delivery to another person in their truck was. That was the source for the whole RoS clause, which 99% of us apparently fail to understand.

There have of course been shades and interpretations since but the basic premise stands.

Not exactly, a substitution is valid providing the OP's company remains completely responsible for the delivery and payment and the sub is an agent of the OP's company, not their own agent. Thus, they cannot "take over the entirety of the contract". But none of that really matters if the goal has nothing to do with demonstrating a RoS that is not unreasonably fettered, as the OP has clarified. The OP just wants to help out their client, so the only relevant thing is whether the hassle/risk is worth it and it probably isn't.

[malvolio]

Thinking about it though, it does present opportunities if the client is fully on board with subs though. There is always the option to sub the rest of the contract out for less than the OP is paid and the OP can then go do a better gig that presents itself. Bit of money from the first sub and chance to jump to a better contract. Worth keeping an eye on it.

No, not at all. As I (and eek) have said, the substitute takes over the entirety of the contract, other than where the resultant income goes. It is not a temporary stand in (other than you can always revert back to status quo ante when you are available yourself again) nor is it a sub-contractor of YourCo.

Refer back to RMC where there was endless debate on this point - the final outcome was that using another driver in your truck was not substitution, giving your contract for that delivery to another person in their truck was. That was the source for the whole RoS clause, which 99% of us apparently fail to understand.

There have of course been shades and interpretations since but the basic premise stands.

[jamesbrown]

tbh the primary reason is to support my client rather than to try and show ir35 status, mainly wanted to ensure nothing possibly negative could come from it! thanks.

Right. The main negative thing would be the hassle/risk for relatively little reward.

[northernladuk]

Thinking about it though, it does present opportunities if the client is fully on board with subs though. There is always the option to sub the rest of the contract out for less than the OP is paid and the OP can then go do a better gig that presents itself. Bit of money from the first sub and chance to jump to a better contract. Worth keeping an eye on it.

[jamesbrown]

I'm sure I read somewhere in HMRC's 'guidance' that if the substitute was a previous/current supplier to your client, it would not really prove anything IR35-wise. Presumably they were trying to avoid a bunch of contractors on the same project all being each other's substitutes for a day, allowing them to answer "Yes" to the 'have you ever used a substitute' question in CEST. That said, I've tried to locate this with a search and haven't found it, so maybe it's out of date.

[Edit]
This article alludes to the same issue: https://www.contractoruk.com/news/00...wake_lppl.html

Yup.

[slogger]

I'm sure I read somewhere in HMRC's 'guidance' that if the substitute was a previous/current supplier to your client, it would not really prove anything IR35-wise. Presumably they were trying to avoid a bunch of contractors on the same project all being each other's substitutes for a day, allowing them to answer "Yes" to the 'have you ever used a substitute' question in CEST. That said, I've tried to locate this with a search and haven't found it, so maybe it's out of date.

[Edit]
This article alludes to the same issue: https://www.contractoruk.com/news/00...wake_lppl.html

tbh the primary reason is to support my client rather than to try and show ir35 status, mainly wanted to ensure nothing possibly negative could come from it! thanks.

[northernladuk]

I'm sure I read somewhere in HMRC's 'guidance' that if the substitute was a previous/current supplier to your client, it would not really prove anything IR35-wise. Presumably they were trying to avoid a bunch of contractors on the same project all being each other's substitutes for a day, allowing them to answer "Yes" to the 'have you ever used a substitute' question in CEST. That said, I've tried to locate this with a search and haven't found it, so maybe it's out of date.

[Edit]
This article alludes to the same issue: https://www.contractoruk.com/news/00...wake_lppl.html

Yeah this has been discussed here before as well. There is a fine line between 'cover' and 'substitution' in these cases. The colleague in question will have already left so more in the sub side than cover but now it's the clients determination anyway it doesn't really matter in the greater scheme. OP just needs to do it, keep the evidence and just carry on. His situation may not be the golden bullet but things have changed anyway so wouldn't be doing this just for the evidence nowadays.

[meanttobeworking]

Fwiw, this probably has little value for IR35 purposes, given your sub currently works for the client, but I guess that isn’t the reason you’re doing it.

I'm sure I read somewhere in HMRC's 'guidance' that if the substitute was a previous/current supplier to your client, it would not really prove anything IR35-wise. Presumably they were trying to avoid a bunch of contractors on the same project all being each other's substitutes for a day, allowing them to answer "Yes" to the 'have you ever used a substitute' question in CEST. That said, I've tried to locate this with a search and haven't found it, so maybe it's out of date.

[Edit]
This article alludes to the same issue: https://www.contractoruk.com/news/00...wake_lppl.html

[jamesbrown]

Fwiw, this probably has little value for IR35 purposes, given your sub currently works for the client, but I guess that isn’t the reason you’re doing it.

[eek]

A contractor actually using ROS

I did this many years ago; cover for 5 days, had to get it approved and him on-site (remember that?) but other than that, I agreed a rate with him and paid him from the company coffers when he invoiced. If I recall, there was a standard contract I found which covered the basics and passed liability on to him if something went wrong.

But I'm sure someone will be along shortly to tell you your contract isn't actually Outside and you're in danger of a large bill a few months down the line when the status changes. Which will definitely happen.

I would ask if RoS actually matters in a world of Chapter 10 IR35 determinations?

I would also ask if the substitution works given it's an ex-colleague for a whole set of other reasons relating to case law I half remember but can't be arsed to read in detail.

But I think Malvolio covers the other issues I would mention.

[northernladuk]

But I'm sure someone will be along shortly to tell you your contract isn't actually Outside and you're in danger of a large bill a few months down the line when the status changes. Which will definitely happen.

Yawn.Change the record. You call other people for posting the same thing over and over again and you are the worst for it.

[malvolio]

Be clear that substitution is not putting in a temp replacement worker it is having another worker taking over the existing B2B contract. So there should be no need for a new contract with the client. What you need is something between you and the other guy to cover how and what he gets paid; a purchase order on his company may suffice...

The logistics of getting him on site are a separate issue.