Multiple Sub Contractors?

[TestMangler]

resurrecting this thread as its something myself and a few others are toying with.

how would this look to the end client? would it be a managed service? thinking aloud, i guess it depends on the contract between the main ltd co and the client?

know of a company that is trying to retain some key contractors beyond the 2year limit beyond which they have to start offering employee type benefits
but if we can form our own co and offer a managed service it may be win win all round.

Erm......what are you talking about ???

I would suggest boning up on this before you follow your plans further.

The bolded line above is nonsensical carp. There is no such obligation.

[DrEvil]

Well the way it works for me is that it came about because I have lots of contacts in the BI area I work in and my client needed more work doing that I could do alone. Its now branched out into other areas still with my field but skills I dont personally have. I just ensure that the schedule of work clearly states whats required during the contract period for my company to deliver. I then delegate that out to the subbies in their contracts with me.

As for the 2 year rule I'm not sure that the permie benefits applies does it to regular contractors? Is it not just the expenses thing after 2 years?

[portseven]

resurrecting this thread as its something myself and a few others are toying with.

how would this look to the end client? would it be a managed service? thinking aloud, i guess it depends on the contract between the main ltd co and the client?

know of a company that is trying to retain some key contractors beyond the 2year limit beyond which they have to start offering employee type benefits

but if we can form our own co and offer a managed service it may be win win all round.

[Wanderer]

The problem seems to be an agency guy who found out (long story) I was possibly taking on a few more people and didn't take kindly to me saying I dont use agencies and only take people I know and trust. He then took offence and starting spouting all this ?? Needless to say I wouldn't be using him even if I did need an agency .

I should have know that it was an agent who came out with that one.

Big respect to you subcontracting stuff out, I hope your business continues to grow.

[SueEllen]

The problem seems to be an agency guy who found out (long story) I was possibly taking on a few more people and didn't take kindly to me saying I dont use agencies and only take people I know and trust. He then took offence and starting spouting all this ??

Explains everything. Very few agents seem to know anything about the bits of contract law they deal with.

[DrEvil]

Thanks everyone

Yes Wanderer my subbies are just regular contractors with their own ltdcos' etc.

I've had the same response from elsewhere too as well as my clued up accountant. His only additional advice was to watch the principle business activity but I'm a fair way yet from making more from that than I get in for myself.

The problem seems to be an agency guy who found out (long story) I was possibly taking on a few more people and didn't take kindly to me saying I dont use agencies and only take people I know and trust. He then took offence and starting spouting all this ?? Needless to say I wouldn't be using him even if I did need an agency .

[thunderlizard]

I agree with everybody else.

Mightily depressing that at the slightest hint of entrepreneurship, someone assumes it must be breaking some law or other.

[Wanderer]

Had someone telling me that I was potentially breaking MSC legislation so I'm trying to get as much advice as possible before proceeding.

Have a read of this: HM Revenue & Customs:Managed Service Companies

Sounds to me like your subbies are running their own LTD companies rather than being shareholders in your company then it's unlikely that you fall foul of the MSC legislation.

[xchaotic]

I bill the end client, take my cut and then pay the invoice of the subcontractor.

Sounds like a winning plan and how capitalism works in general.
As always the downside is you're relying on other people to get the job done, but it seems you've got this figured out.

[Fred Bloggs]

For the record, I don't know if my answer will be correct. I cannot see how the MSC Legislation applies if your company has a contract with the client and a contract with the sub-contractor ltd company. I hope you find the correct answer soon.

I agree, can't see how MSC legislation applies here if there are B2B contracts in place between Ltd Cos.

[pmeswani]

Yes there is an overall contract between my ltdco direct to end client and then individudal contracts with each sub-contract company. There is no employment related stuff like paying their taxes etc for them. Its just I bill the end client, take my cut and then pay the invoice of the subcontractor.

The schedule of work between me and the end client just lists deliverables expected of my ltdco and I just divvy up the work as I see fit and add it to the subcontract schedule of work.

Had someone telling me that I was potentially breaking MSC legislation so I'm trying to get as much advice as possible before proceeding.

For the record, I don't know if my answer will be correct. I cannot see how the MSC Legislation applies if your company has a contract with the client and a contract with the sub-contractor ltd company. I hope you find the correct answer soon.

[DrEvil]

Yes there is an overall contract between my ltdco direct to end client and then individudal contracts with each sub-contract company. There is no employment related stuff like paying their taxes etc for them. Its just I bill the end client, take my cut and then pay the invoice of the subcontractor.

The schedule of work between me and the end client just lists deliverables expected of my ltdco and I just divvy up the work as I see fit and add it to the subcontract schedule of work.

Had someone telling me that I was potentially breaking MSC legislation so I'm trying to get as much advice as possible before proceeding.

[pmeswani]

In a position where I currently supply another sub-contractor to my client and there is no agency/middle man in place all works nice and I take a cut out of the daily rate.

I'm having discussions at the moment about maybe 2/3 more of them.

Does anyone know if there are any implications of doing this from a legal side?

The question I would ask is whether you have a contract with the sub-contractors and whether the sub-contractors have accepted liability for paying their own taxes. I don't think the Agency Regulations apply, but I defer that point to someone else to answer.

[DrEvil]

In a position where I currently supply another sub-contractor to my client and there is no agency/middle man in place all works nice and I take a cut out of the daily rate.

I'm having discussions at the moment about maybe 2/3 more of them.

Does anyone know if there are any implications of doing this from a legal side?