Reply to: Best accountancy firms for LTD in 2023 - Contractor in tech - Outside IR35

[philgo]

I may have not been properly clear in an earlier post.

You can only be justifiably outside IR35 in a YourCo/agency/client relationship if you have no contact with them. Any less than that and IR35 may well apply.

However, if that is the case (which you have said it isn't, but hey...) you then have the problem of you to the agency/consultancy. They have sold the client your skills, no doubt as their own in-house resource, to do 'something', so the IR35 case drops down one to their level. So, for example, if they give you a task to do does that not then constitute Direction?

I would agree but as you said it's very complicated to interpret the "how" and this where you have the most arguments.
In my case simply reading ESM 10010 it poses warning...so no need to look further. The chain simply does not work. ESM 10010 Rules details "who you should consider to be your client" (so not necessarily what the chain of contracts suggests) and it would likely be the end client in my case. But as it is contracted out by consultancy it cannot be the case => full stop :-)

So the argument would be around the who is the end client and if in fact I spend lots of time with the end clients to pick up info......=> Only option would be chapter 10 with SDS done by end client but I don't want that.

[malvolio]

I may have not been properly clear in an earlier post.

You can only be justifiably outside IR35 in a YourCo/agency/client relationship if you have no contact with them. Any less than that and IR35 may well apply.

However, if that is the case (which you have said it isn't, but hey...) you then have the problem of you to the agency/consultancy. They have sold the client your skills, no doubt as their own in-house resource, to do 'something', so the IR35 case drops down one to their level. So, for example, if they give you a task to do does that not then constitute Direction?

[BigLadFromBeeston666]

Very bad experience with Gorilla here as well. Switching accountant more often than SJD, worthless advice, late filings etc.

Seems to be expanding too quickly, doesn't it? Are you sticking with them then? I think I'll have a go at Mettle + FreeAgent for a year and if it all goes Pete Tong, fling the books at an accountant end of year for the CT submission.

[Eirikur]

Very bad experience with Gorilla here as well. Switching accountant more often than SJD, worthless advice, late filings etc.

[philgo]

Excellent, so now all you have to do is set up a new company, get the new bank account opened, get an accountant on board, and get the contact written based on your new company.

If that's what you choose to do.

Not sure if you have seen my last post on the other thread but I really got into the details of the offer (contract relationship based) and IR35 rules.
I don't feel the way the "consultancy" wants this to work is compliant enough i.e contract wise it "might work" but in practice the "how" the work will be delivered might not comply fully with ESM10000 and especially on the fact that the main "interactions" will be with the consultancy company's end client and not with the consultancy company contracted out the resource.
So that's a big warning, even if I will have full control on how I operate in the role with no supervision neither by the consultancy company nor the end client.

With all this knowledge onboard, I can also see that even if I was offered other gig outside IR35 by other small "agency/consultancy" they would probably use the same framework with SOW with end client + contracted out so I would have the same issue. Therefore It would mean the same potential risk each time. It explains why in my expertise there is not anymore contract outside IR35 offered by end clients. Its is simply too risky as you have to interpret a lot of IR35 rules. You could spend hours arguing on the working practice....It also explain why big proper consultancy only offer PAYE or IN contracts.

So with this in mind, It would mean I potentially reopen a company for only this one shot gig which is too much hassle specially in the case I would not like the job. More by reopening it could also trigger HMRC too look at the one I MVLed. This was done properly with no issues on past contracts with regards of IR35 but again you don't want all this hassle just for one gig where you are unsure about working practise versus contract versus IR35.

Long story short, I have already started to explain the "agency/consultancy" that it would probably be more beneficial for everyone on this role to be IN via umbrella at least for the start. So let's see. At least now I feel comfortable with the topic.

* I named it "agency consultancy" all along cause to me they are not true consultancy like the big ones who can deploy an army of soldiers to work on XWX for a client. They are more the type like acting as a intermediary and outsourcing the resources so to me they act more as a agency on the "how" by finding experts like a recruiter would do but then use "consultancy" type contracts. Also if they really are the supplier they should therefore be my end client and explain me the work to be done within the assigment not their end client So they can get the paper sounding like it but looking at the how as said above it's a big warning.

[WTFH]

So now that I got replied after challenging the accountant answer :
He has now revisited his opinion and after "double checking" he agrees with the liquidator than capital distribution date is effectively the reference date for the 2 years count down.
That comfort my initial decision to change accounting company as this is not the first time I have to challenge answers and company coming back with a different version....The ex accountant was way better but he left the ship....

Excellent, so now all you have to do is set up a new company, get the new bank account opened, get an accountant on board, and get the contact written based on your new company.

If that's what you choose to do.

[philgo]

I'm just going by the words you shared with us:



"Maybe he sees a different risk"
You're not sure if he sees a different risk, or you're not going to tell us what that risk is.

Back to what several of us have said before: we can only go on what you choose to tell us. You use the word "maybe" and that means you're unsure if or why he sees a risk.

So now that I got replied after challenging the accountant answer :
He has now revisited his opinion and after "double checking" he agrees with the liquidator than capital distribution date is effectively the reference date for the 2 years count down.
That comfort my initial decision to change accounting company as this is not the first time I have to challenge answers and company coming back with a different version....The ex accountant was way better but he left the ship....

[philgo]

I'm tempted to start doing this again. Paying £144 p/m incl. VAT stings a little. Gorilla also don't include a second director's SA for that fee which isn't great either. Is the best time to switch typically when the company year end books are done and submitted? That's probably when you get the most money's worth out of them.

I know this thread has drifted, so allow me to drift a little further. There's a real need for something approaching part-accountant, part-financial planner for contractors. Yes, accountants will give you the basics around expensing the annual party, trivial benefits etc but will leave out the tax planning stuff that really impacts your bottom line, like SIPP contributions. They won't tell you to stick the money rotting in your business account in Wise and get nearly 5% whilst you wait for an invoice to land.

I'm sure most of us had to learn these lessons the hard way. It would've been nice to have learned them from the people assisting our business growth.

Financial planners charging a % based fee for their advice, which largely entails investing in their funds, doesn't really work either. Especially, once you consider that a global index fund /ETF / OEIC will beat them the majority of the time -- especially once you factor in their fees.

I think a lot of directors are vaguely unhappy with their accountants. The rest of us settle for their role as essentially a time relief for admin, and on infrequent occassions like getting a mortgage or needing a reference, a necessary evil.

Hmm.

Agree with this but as lot would say here, when you have a business as a director you should learn the ropes and ask questions about tax planning and tax efficiencies.
That's the way I have operated in the past, searching and then asking the accountant. Then you need to make sure you have the right accountant in front of you...

But at the end totally agree that there are no such services available on the market for a reasonable fee. But equally if you work out yourself and ask questions not sure there is a case to have a service like that as not sure you can do a lot if you only look at the company level and not the whole individual situation. In that case you fall back in the financial planner scope. At the end you need to know what your strategy is in regards of SIPP dividends salary etc...

But agree I have seen lots and lots of contractors not understanding the SIPP, tax thresholds, Salary versus dividends, tax efficiency and having lots of cash dead in the company simply because they have not tried to learn and are expecting accountant to do that for them. I guess it's not really the job of an accountant but more a tax expert.

[gixxer2021]

Moved from SJD (left it a bit too late and was probably one of the last using their spreadsheet…) to Maslins, who have been excellent and would highly recommend.

[BigLadFromBeeston666]

If you are are a typical one contract at a time contractor (IT) then FreeAgent does everything now, you don't need an accountant, just spend few minutes a day keeping it up to date and it can submit all your tax returns etc.

I'm tempted to start doing this again. Paying £144 p/m incl. VAT stings a little. Gorilla also don't include a second director's SA for that fee which isn't great either. Is the best time to switch typically when the company year end books are done and submitted? That's probably when you get the most money's worth out of them.

I know this thread has drifted, so allow me to drift a little further. There's a real need for something approaching part-accountant, part-financial planner for contractors. Yes, accountants will give you the basics around expensing the annual party, trivial benefits etc but will leave out the tax planning stuff that really impacts your bottom line, like SIPP contributions. They won't tell you to stick the money rotting in your business account in Wise and get nearly 5% whilst you wait for an invoice to land.

I'm sure most of us had to learn these lessons the hard way. It would've been nice to have learned them from the people assisting our business growth.

Financial planners charging a % based fee for their advice, which largely entails investing in their funds, doesn't really work either. Especially, once you consider that a global index fund /ETF / OEIC will beat them the majority of the time -- especially once you factor in their fees.

I think a lot of directors are vaguely unhappy with their accountants. The rest of us settle for their role as essentially a time relief for admin, and on infrequent occassions like getting a mortgage or needing a reference, a necessary evil.

Hmm.

[hobnob]

My experience with the IASME certificate search is it's total tulip.

I haven't had that experience, but I'll take your word for it.

In this case, I queried it with Gorilla directly, and they confirmed that the certificate had lapsed. That suggests a few possibilities about why they left the logo on their website:
* They forgot that the logo was there. (Not applicable after I'd emailed them.)
* They don't know how to update the website.
* They think it would cost too much time/money to update the website (e.g. if they have to pay a 3rd party a fixed fee for each change).
* They're worried about losing business if they update the website, i.e. they actively want to deceive people.

It reminds me of something I've seen with job hunters. People send in their CV which says "CCNA certified" (or similar) and then when I ask about it they say "I've done the course but I haven't taken the exam yet" or "I did pass the exam but then it expired and I haven't renewed it". I think that someone can be a good candidate without having certification X, but lying about it is a red flag.

[philgo]

I'm just going by the words you shared with us:



"Maybe he sees a different risk"
You're not sure if he sees a different risk, or you're not going to tell us what that risk is.

Back to what several of us have said before: we can only go on what you choose to tell us. You use the word "maybe" and that means you're unsure if or why he sees a risk.

Yes I said "maybe" so that's an assumption on my side so until I got anymore details from him no point talking more about this.

[Lance]

According to their website they do offer FreeAgent. Maybe that's changed since you last looked?



I'm with Maslins, and I've been very happy with their service. My only problem is that they don't have Cyber Essentials (or similar) - that won't affect most contractors, but I need to specify requirements for my supply chain (so that MyCo can get IASME Cyber Assurance), so I think I'll need to move.



I was looking at Gorilla recently, since their website has the Cyber Essentials icon. However, when I checked the IASME website (certificate search), they aren't listed. I queried that with Gorilla, and they said that they're going through the renewal process, which was "due to be completed within the next 2-3 weeks". That was 4 weeks ago, and nothing's changed (i.e. they still have the icon without the certificate). Again, I think that this specific issue won't affect most contractors, but personally I think it's a bit iffy to claim something that you don't have, and it makes me wonder where else they might be stretching the truth.

My experience with the IASME certificate search is it's total tulip. Companies I know that have it don't come up, and when you widen the search it glibly tells you "Too many results returned
Your search would have returned 661 results. Please try a more targeted search"

[WTFH]

Understand where you are coming from but again like before you are anticipating that I might not have challenged the accountant answer. Who did say I did not...

I'm just going by the words you shared with us:

I think the accountant is wrong but maybe he sees a different risk.

"Maybe he sees a different risk"
You're not sure if he sees a different risk, or you're not going to tell us what that risk is.

Back to what several of us have said before: we can only go on what you choose to tell us. You use the word "maybe" and that means you're unsure if or why he sees a risk.

[philgo]

Did you ask the accountant why he said what he did?

If someone disagrees with you or says something that you find challenging, it's always good to ask (with an open mind) why they are saying what they say.
It could be experience
It could be based on them not having the whole story (or having it, but being able to remove the emotive parts)
It could be that they interpret things in a different way, and maybe learning from them why they do that would help
It could be that they are providing the safest answer based on how much you are paying them for it.
It could be that you've asked a very narrow question that isn't really the one you should be asking.

That's also why sometimes posters on here will look at someone's post history to see if it gives any clues.

Understand where you are coming from but again like before you are anticipating that I might not have challenged the accountant answer. Who did say I did not...