Reply to: Agent Double Checking if I am the "Sole Fee Earner"

[ladymuck]

all should be fine. agency just wants to know . chill. HMRC will target the client and not you.

That's funny

[RobScott]

Yeah good point but I think the purpose will be the same. Looking for anything odd that is out of their normal operating model that can cause risk they aren't prepared to handle i.e. not a single man contracting LTD. Any rhyme or reason beyond that goes out the window when we are talking about agents here. They are well known for possibly attempting to do the right thing for completely the wrong reasons.

all should be fine. agency just wants to know . chill. HMRC will target the client and not you.

[northernladuk]

The OP was being asked if they were the sole fee earner, not the majority shareholder..

Yeah good point but I think the purpose will be the same. Looking for anything odd that is out of their normal operating model that can cause risk they aren't prepared to handle i.e. not a single man contracting LTD. Any rhyme or reason beyond that goes out the window when we are talking about agents here. They are well known for possibly attempting to do the right thing for completely the wrong reasons.

[ladymuck]

That isn’t on the agency off payroll reporting form so please start silly rumours like that.

Then I have no idea what right the agency has to ask how many people are revenue generators. That was the only reason I could think of as, as NLUK says, it's got nothing to do with IR35.

[eek]

The OP was being asked if they were the sole fee earner, not the majority shareholder.

I suspect, for agency reporting purposes, they are reporting Badger Ltd has 2 directors and 1 fee earner. This is tasty info for HMRC who might think, ooh income shifting, that's worth a look.

That isn’t on the agency off payroll reporting form so please start silly rumours like that.

[ladymuck]

Yep IR35 is about the type/way the work is done. Not how a business is structured so at that point we should know it's the agent and not IR35. But from a business perspective I don't see it unreasonable to check that the person signing the contractor isn't some minor shareholder that has no say in how the business might be run and therefore pose a risk to the agent.

The OP was being asked if they were the sole fee earner, not the majority shareholder.

I suspect, for agency reporting purposes, they are reporting Badger Ltd has 2 directors and 1 fee earner. This is tasty info for HMRC who might think, ooh income shifting, that's worth a look.

[Protagoras]

I must say that I've never been asked that, and would have had to answer that I was not the sole fee-earner if questioned, so I should probably be grateful that no one ever asked! What happens when one says 'no;?

[northernladuk]

This was what threw me. I get asking about significant control (which obviously I've done with them previously when the contract was started), but why this would matter for IR35 was getting me suspicious.

Yep IR35 is about the type/way the work is done. Not how a business is structured so at that point we should know it's the agent and not IR35. But from a business perspective I don't see it unreasonable to check that the person signing the contractor isn't some minor shareholder that has no say in how the business might be run and therefore pose a risk to the agent.

[Bodger]

I wouldn't take any notice of the IR35 bit. They may do it under their process of IR35 checking but as usual they've got it wrong and nothing to do with IR35.

This was what threw me. I get asking about significant control (which obviously I've done with them previously when the contract was started), but why this would matter for IR35 was getting me suspicious.

[northernladuk]

Really, it's none of the agencies business?

To be fair while they don't know and haven't assessed the risk it kind of is. No one should be engaging with a LTD without a basic level of diligence really.

[edison]

I wouldn't take any notice of the IR35 bit. They may do it under their process of IR35 checking but as usual they've got it wrong and nothing to do with IR35.

It's pretty common for agents to check this and many won't deal with you if you aren't the majority shareholder. We've got posts as far back as 2016 from contractors bumping in to this.

I might not have the full picture but the best idea as to why they do this we could come up with is the potential that the controlling person isn't signing the contract and not being majority shareholder you are not in charge of what the company might do going forward.

This.

I'm working direct with a client at the moment and more or less this exact clause was in the contract.

[eek]

Really, it's none of the agencies business?

The business structure and relationship between the person they are paying for and that business is very much something an agency needs to know about for HMRC reporting reasons...

[Fred Bloggs]

Really, it's none of the agencies business?

[northernladuk]

I wouldn't take any notice of the IR35 bit. They may do it under their process of IR35 checking but as usual they've got it wrong and nothing to do with IR35.

It's pretty common for agents to check this and many won't deal with you if you aren't the majority shareholder. We've got posts as far back as 2016 from contractors bumping in to this.

I might not have the full picture but the best idea as to why they do this we could come up with is the potential that the controlling person isn't signing the contract and not being majority shareholder you are not in charge of what the company might do going forward.

[Andy Hallett]

Gut feel is it isn't anything to worry about. Back in the day we always used to check that the worker doing the work for a Personal Service Company was a Personal With Significant Control. We changed this after the demise of composite companies caused be 2007 Finance Act.