Or the Agency may complain but do nothing and you carry on with the End Client as before, we can’t say for definite one way or the other, just provide possible options.
And I think with Lance’s advice that’s as far as we can go with this thread.
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Reply to: Going direct with client
Collapse
You are not logged in or you do not have permission to access this page. This could be due to one of several reasons:
- You are not logged in. If you are already registered, fill in the form below to log in, or follow the "Sign Up" link to register a new account.
- You may not have sufficient privileges to access this page. Are you trying to edit someone else's post, access administrative features or some other privileged system?
- If you are trying to post, the administrator may have disabled your account, or it may be awaiting activation.
Logging in...
Previously on "Going direct with client"
Collapse
-
Originally posted by MollyDolly View Post
I am just trying to find out how Agency can stop me taking this route as they are the only one who has not been consulted yet by me or End Client and since neither of us have a contract with Agency so we have no need to consult with Agency.
However they could attempt to sue the IT provider for lost revenue.
Let's say that there is £500 a day, for a 3 month contract, that is £30k.
Are the IT support provider willing to take that risk?
Has the letter that's been written been through the IT Support provider's legal team?
There's lots that can go wrong. None of it may go wrong.
The fact you're querying suggest you're not sure. You could end up with nothing.
This is all about risk.
Leave a comment:
-
Originally posted by northernladuk View Post
The contract will be between the agent and the umbrella. It's a chain with a contract between each party. Client Agent Umbrella you.
I see there is some other notes about the situation after you posted that which I haven't read but the above is generally how it works.
I can't believe the client hasn't signed a contract or has some kind of memorandum of understanding. How do you know this as it isn't your business?
Client has contract with IT Support Provider and not Agency. Even if there is any contract between Agency and Client (not possible but for arguments sake lets say there is any such contract), why should I worry about their contract? Its End Client who should worry about this and not me. End Client is ready to work direct with me as they have got it in written from IT Support Provider.
I am just trying to find out how Agency can stop me taking this route as they are the only one who has not been consulted yet by me or End Client and since neither of us have a contract with Agency so we have no need to consult with Agency.
Leave a comment:
-
Originally posted by Lance View Post
It is entirely possible that the agency kicks up so much of a stink with the IT Support Provider that your move to the end client becomes impossible.
When you say the IT Support Provider is happy for you to direct, is that verbal? Or in writing? And if the latter does it align with/agree with any contractual terms the IT Support Provider has with the agency and/or the client?
How is it different if tomorrow I would have joined let's say ABCXYG Consultancy Limited (hypothetical new IT Consultancy) as Permanent Employee who then supply me to End Client? How can Agency or IT Support Provider stop this?Last edited by MollyDolly; 25 May 2022, 14:29.
Leave a comment:
-
Originally posted by MollyDolly View Post
Neither me nor end client have signed any contract with Agency so how any handcuff clause will apply? How would agency protect their business interest in this case?
I see there is some other notes about the situation after you posted that which I haven't read but the above is generally how it works.
I can't believe the client hasn't signed a contract or has some kind of memorandum of understanding. How do you know this as it isn't your business?
Leave a comment:
-
Originally posted by MollyDolly View Post
The IT support provider should have a contract with End Client but same IT Support Provider has confirmed to end client that they will let me go direct with End Client for free. The End Client cares only what IT Support Provider agrees with them and not about the contract between agency and IT support Provider as it’s upto IT Support Provider to sort out with Agency.
When you say the IT Support Provider is happy for you to direct, is that verbal? Or in writing? And if the latter does it align with/agree with any contractual terms the IT Support Provider has with the agency and/or the client?
Leave a comment:
-
Originally posted by MollyDolly View Post
Neither me nor end client have signed any contract with Agency so how any handcuff clause will apply? How would agency protect their business interest in this case?
And if it goes to IR35 (old or new) all those intermediate contracts will be ignored anyway. It's your relationship with the end client that will matter.
Leave a comment:
-
Originally posted by MollyDolly View Post
Why do you think that end client will not accept me using umbrella?
Also, would I have any risk if I open a LTD company and sign outside IR35 contract with end client?
And as for risk, HMRC will see that you’ve moved from umbrella to Ltd, and as they are trying to get contractors to go from Ltd to umbrella they may well take an interest in your change of circumstance.
Anyway, I feel that we are beginning to repeat ourselves here - I would advise that you go back and reread this thread.
Leave a comment:
-
Originally posted by MollyDolly View Post
The IT support provider should have a contract with End Client but same IT Support Provider has confirmed to end client that they will let me go direct with End Client for free. The End Client cares only what IT Support Provider agrees with them and not about the contract between agency and IT support Provider as it’s upto IT Support Provider to sort out with Agency.
Have you discussed it with the umbrella and the agency?
Have you got written confirmation from each of the businesses in the chain that there is no clause which prevents you from going direct?
While you might say that it's up to the IT Support Provider to sort it out with the agency, if there are clauses in the contracts, they will come to you looking for their lost revenue.
Leave a comment:
-
Originally posted by WTFH View Post
You gave the flow of the contracts in your first post. The agency has signed a contract with the IT service provider, and the IT service provider will have signed a contract with the end client.
Leave a comment:
-
Originally posted by MollyDolly View Post
Neither me nor end client have signed any contract with Agency so how any handcuff clause will apply? How would agency protect their business interest in this case?
Leave a comment:
-
Originally posted by northernladuk View PostIt's the agency that will have the handcuff and will block any direct engagement as it is them that will lose commission, not the umbrella. They are just a payment vehicle and won't care.
Leave a comment:
-
Originally posted by cojak View PostIn that case, it will be a different contract.
Resign from your current umbrella and go with a legitimate umbrella that is acceptable to you and the end client.
There’s normally a clause in your agency contract that tries to stop this but since you only have a contract with the umbrella, I can’t see how it applies.
(But saying that, I’ll bet that the end client won’t accept you using an umbrella, so the posts above this one still applies…)
Also, would I have any risk if I open a LTD company and sign outside IR35 contract with end client?
Leave a comment:
-
In that case, it will be a different contract.
Resign from your current umbrella and go with a legitimate umbrella that is acceptable to you and the end client.
There’s normally a clause in your agency contract that tries to stop this but since you only have a contract with the umbrella, I can’t see how it applies.
(But saying that, I’ll bet that the end client won’t accept you using an umbrella, so the posts above this one still applies…)
Leave a comment:
-
Originally posted by Lance View Postwhat makes you think it's outside IR35?
Cojak is correct in that it can't be outside IR35 due to you being employed by an umbrella. But for some reason you think it is. How is that?
Have you seen an SDS that says outside?
Who is the end client on you contract, the support provider or the end client?
With so little information that answer is that you shouldn't pursue this. On the face of it you will be quitting employment to go contracting for the simple reason to gain a tax advantage. That is right in the target area of what IR35 is intended to stop. So if you are noticed I'd say it's a slam dunk win for HMRC.
In my current contract with Umbrella, the client is mentioned as IT Support Provider. The true end client name is no where in my contract. My assignment details contain name of the Agency. There is no tax saving angle in my pursuit of this route. The End Client has asked for this route and they have agreed with IT Support Provider that IT Support Provider will let me go free and work directly with End Client.
I am wondering how Agency would be able to stop this arrangement? I can simply resign from my current umbrella and go to a new umbrella who signs a contract with end client. Can the agency create any issue here? I am on a monthly payment terms with Agency so if I do this and if agency is unhappy, can they stop my last month's payment? I am sure Agencies would have a way to protect their business interest but I am unable to figure it out.
Leave a comment:
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: