IR35 - two very quick questions

[TheCyclingProgrammer]

I sometimes work via agencies and sometimes not. But my working practices are very clear. I usually have a contract for (e.g.) up to 80 days work between 1 January and 30 June and I usually have multiple clients at once. I decide where I work and (for example) have just declined a project with my current client, and of course that means we may part ways on good terms, but it is a very different relationship from employment. Some of it is a state of mind. If you don't feel like an employee, you don't tend to act like one, whereas if you spend your time worrying that you're like an employee then you need to have a rethink. All IMO of course.

I agree with all of that and have the same mindset as far as working practices go, I just wouldn't trust a typical agency contract to back up the working practices (and I do think its better to have both on your side).

[northernladuk]

Thanks.

You are all of course, correct in that I should get it reviewed. I am not qualified to make this call. However, I have read up on it a fair bit and my worries above stem from the point of control (I want to, and will, be able to work a 6 hour day or a 10 hour day depending on what I deem necessary). I just wanted to check that having "8 hours" stipulated doesn't make that sticky.

Yep but not unreasonable for a client to dictate how many hours he is willing to pay for. You can work 10 hours if you want, you just won't get paid for them. There is quite a grey area that sits between D&C and professional courtesy that can easily be argued. For example they say smart casual attire while on site which you do. D&C or courtesy?

I also read that I should ideally invoice when I've delivered what I'm paid to. A regular invoice could look like a salary. It's not realistic for me to invoice at the end of 6 months of course, but I have had some flexibility in all my other contracts. It's up to me when I send in the invoice. If I'm happy to wait 4-6 weeks, then I can. It look like I can't on this contract even if I wanted to.

Not correct at all and you need to be very clear in this distinction. What your client pays your business is absolutely in no way related to salary. It's money that belongs to the business. It's not salary until it is paid to you. A very important distinction. You could argue that paying dividends monthly is also like a salary.. but again just because something just happens to have a regularly monthly timescale it doesn't mean it is the same as something else. Yes payment upon delivery is the best IR35 situation but being paid regularly is not a problem. What business doesn't want to be paid regularly. Keep in mind 99.99999% of contractors will be billing regularly, be it 45,30,5 days or whatever.

I will get it reviewed though.

Please do. There is a term that can exist in RoS that makes it useless so very important to get right. If the client has the right to refuse your sub without reason then it's not worth the paper it's written on from an IR35 perspective.

[Old Greg]

I don't either, although a) I don't work through agencies and b) my standard contract is based on the PCG contract so I'm pretty confident in it + my working practices.

If I was using agency contracts, I'd be getting each and every one reviewed unless I'd had the exact same contract before.

I sometimes work via agencies and sometimes not. But my working practices are very clear. I usually have a contract for (e.g.) up to 80 days work between 1 January and 30 June and I usually have multiple clients at once. I decide where I work and (for example) have just declined a project with my current client, and of course that means we may part ways on good terms, but it is a very different relationship from employment. Some of it is a state of mind. If you don't feel like an employee, you don't tend to act like one, whereas if you spend your time worrying that you're like an employee then you need to have a rethink. All IMO of course.

[TheCyclingProgrammer]

I also read that I should ideally invoice when I've delivered what I'm paid to. A regular invoice could look like a salary.

I'm sorry but no. In what way could it be construed as a salary? YourCo is invoicing the agency, who are then paying your invoice. It makes no difference whether you invoice weekly, fortnightly, monthly or on completion. Invoicing weekly is great for cash-flow - be happy!

[TheCyclingProgrammer]

I am in the CUK minority and never get contracts reviewed. However, you sound new? I would get your contract reviewed.

I don't either, although a) I don't work through agencies and b) my standard contract is based on the PCG contract so I'm pretty confident in it + my working practices.

If I was using agency contracts, I'd be getting each and every one reviewed unless I'd had the exact same contract before.

[Old Greg]

Thanks.

You are all of course, correct in that I should get it reviewed. I am not qualified to make this call. However, I have read up on it a fair bit and my worries above stem from the point of control (I want to, and will, be able to work a 6 hour day or a 10 hour day depending on what I deem necessary). I just wanted to check that having "8 hours" stipulated doesn't make that sticky.

I also read that I should ideally invoice when I've delivered what I'm paid to. A regular invoice could look like a salary. It's not realistic for me to invoice at the end of 6 months of course, but I have had some flexibility in all my other contracts. It's up to me when I send in the invoice. If I'm happy to wait 4-6 weeks, then I can. It look like I can't on this contract even if I wanted to.

I'm aware that working practices outweight the contract, but I know it's still important. I certainly don't want to have a minor inclusion in the contract upset everything else.

I'm covered on RoS, MOO etc, so I'm happy with that.

I've been happy with all the contracts I've had so far, but the three points above have not been present before, so just wanted to run them by the more experienced and enlightened among you.

I will get it reviewed though.

If you're on a daily rate, you're being paid on delivery of a day's work.

Still, I can see IR35 advantages in being paid on delivery of product / milestones, but most of us dislike the risk of poor cashflow or non-payment.

[TheCyclingProgrammer]

Working hours have been discussed on here several times but if the client expects at least 8 hours in a day that's not unreasonable and just business. That they aren't specifying your actual working hours is a good thing as far as direction and control is concerned.

The arrangement with the agency is known as self-billing and has nothing to do with IR35 whatsoever - its just a means of making life easier for the agency.

The only caveat I will say is if you have a self-billing arrangement and there is any chance of you re-charging expenses to the client, watch out for the agency re-charging the net rather than the gross (and expect the classic "VAT on VAT" argument from them). If you're not going to be re-charging expenses, feel free to ignore this paragraph.

[JRCT]

My potential worry is you don't understand IR35 and that you are not getting it professionally reviewed.



And? What aspect of this worries you with regard to IR35? Read up on Direction and Control and then re-think this.



And again, what aspect of IR35 is worrying you? Payment timescales are hardly a factor in how you work.



Are you really sure of that? You are qualified to make that call? You do understand that working practices trump the contract so although it is very important to get your contract worded properly and reviewed it's only have the battle?

Thanks.

You are all of course, correct in that I should get it reviewed. I am not qualified to make this call. However, I have read up on it a fair bit and my worries above stem from the point of control (I want to, and will, be able to work a 6 hour day or a 10 hour day depending on what I deem necessary). I just wanted to check that having "8 hours" stipulated doesn't make that sticky.

I also read that I should ideally invoice when I've delivered what I'm paid to. A regular invoice could look like a salary. It's not realistic for me to invoice at the end of 6 months of course, but I have had some flexibility in all my other contracts. It's up to me when I send in the invoice. If I'm happy to wait 4-6 weeks, then I can. It look like I can't on this contract even if I wanted to.

I'm aware that working practices outweight the contract, but I know it's still important. I certainly don't want to have a minor inclusion in the contract upset everything else.

I'm covered on RoS, MOO etc, so I'm happy with that.

I've been happy with all the contracts I've had so far, but the three points above have not been present before, so just wanted to run them by the more experienced and enlightened among you.

I will get it reviewed though.

[northernladuk]

I'm fairly confident that my contract is ok, but after reading up on lots of IR35 stuff on here, and elsewhere I've suddenly become a bit paranoid. I've reread my contract and I'm fairly satisfied, however there are two 'minor' things that are potential worries.

My potential worry is you don't understand IR35 and that you are not getting it professionally reviewed.

I'm paid a day rate and on my contract it stipulates an 8 hour day, although it doesn't say which 8 hours.

And? What aspect of this worries you with regard to IR35? Read up on Direction and Control and then re-think this.

My agency have a system in which they invoice the end client on my behalf. I just have to send them a copy of my timesheet

The end client insists that all timesheets are put through weekly. Therefore, my ltdco will be receiving the same payment every Friday (assuming I always work 5 days).

And again, what aspect of IR35 is worrying you? Payment timescales are hardly a factor in how you work.

I'm happy with the rest of the contract, seems to be worded as well as it could be.

Are you really sure of that? You are qualified to make that call? You do understand that working practices trump the contract so although it is very important to get your contract worded properly and reviewed it's only have the battle?

[Old Greg]

I am in the CUK minority and never get contracts reviewed. However, you sound new? I would get your contract reviewed.

[Clare@InTouch]

As long as your working conditions cover one of the main factors - Control, Personal Service, Mutuality of Obligation - then invoicing and hours should be nothing more than admin issues.

Note though that it's your working conditions that count, not the written contract. The written contract is no use unless it's realistic.

[Craig at Nixon Williams]

These things shouldn't cause you any problems.

If I was in your shoes, I'd still get it reviewed by a professional rather than doing it myself though.

Craig

[mudskipper]

I'm fairly confident that my contract is ok, but after reading up on lots of IR35 stuff on here, and elsewhere I've suddenly become a bit paranoid. I've reread my contract and I'm fairly satisfied, however there are two 'minor' things that are potential worries.

I'm paid a day rate and on my contract it stipulates an 8 hour day, although it doesn't say which 8 hours.

My agency have a system in which they invoice the end client on my behalf. I just have to send them a copy of my timesheet.

The end client insists that all timesheets are put through weekly. Therefore, my ltdco will be receiving the same payment every Friday (assuming I always work 5 days).

Are any of these things likely to be an issue in themselves?

I'm happy with the rest of the contract, seems to be worded as well as it could be.


P.S. I realise that's actually 3 things.

All sound fairly commonplace.

The usual advice is to get your contract professionally reviewed (QDOS or B&C) and/or join PCG+ to have representation if you are investigated.

[TheFaQQer]

Are any of these things likely to be an issue in themselves?

No.

[JRCT]

I'm fairly confident that my contract is ok, but after reading up on lots of IR35 stuff on here, and elsewhere I've suddenly become a bit paranoid. I've reread my contract and I'm fairly satisfied, however there are two 'minor' things that are potential worries.

I'm paid a day rate and on my contract it stipulates an 8 hour day, although it doesn't say which 8 hours.

My agency have a system in which they invoice the end client on my behalf. I just have to send them a copy of my timesheet.

The end client insists that all timesheets are put through weekly. Therefore, my ltdco will be receiving the same payment every Friday (assuming I always work 5 days).

Are any of these things likely to be an issue in themselves?

I'm happy with the rest of the contract, seems to be worded as well as it could be.


P.S. I realise that's actually 3 things.