Reply to: 1st contract - not an official renewal but asked to stay on ad hoc basis

[ckms]

I am reading them as I write this. Thank you

[jamesbrown]

I have spent many many hours researching and learning prior to the set up of my limited company. My question related to the terms of my contract which are not straightforward hence my request for advice which has been forthcoming. For this feedback I am most grateful but just because I had not yet come across a couple of acronyms this does not make me naive or stupid. I appreciate you do not wish to sound patronising

I didn't say you were stupid. Naive, perhaps, since you're effectively working without a contract and also, by paying dividends, you're working under the assumption that it's outside IR35 (at least you had a professional review, but you apparently don't understand the central tenets of IR35, otherwise you would've come across these acronyms). Anyway, best of luck with getting this sorted, and it wouldn't hurt to do some more reading on IR35 etc. The guides here are pretty good.

[ckms]

I have spent many many hours researching and learning prior to the set up of my limited company. My question related to the terms of my contract which are not straightforward hence my request for advice which has been forthcoming. For this feedback I am most grateful but just because I had not yet come across a couple of acronyms this does not make me naive or stupid. I appreciate you do not wish to sound patronising

[jamesbrown]

Thank you jbond007. Most helpful. Hardly everyday terms that I might be expected to know so thanks for answering my question

No, on the contrary, you should be familiar with these terms. You cannot simply rely on a contract review from QDOS or anyone else, because IR35 is determined by working practices, not simply by agreed contractual terms (which you don't even have to begin with!). Without wishing to be patronising, the amount of important information that you currently don't know will surprise you, so take a look at the guides --->

[ckms]

Thank you jbond007. Most helpful. Hardly everyday terms that I might be expected to know so thanks for answering my question

[jbond007]

This should be scary enough, my friend.

qh

As with most forums you'll get people who have time for sarcastic comments but not actually answer. In any case, here you go ..

Moo - Mutuality of Obligation
D&C - Direction & Control

http://www.nixonwilliams.com/images/IR35%20Guide.pdf

[psychocandy]

Hmm. Would be a bit concerned that person wants this as non-official for whatever reason.

What happens when someone 'official' finds out whats been going on and suddenly demands an end to payments and you're left high and dry?

I generally try to shy away from any dodgy deals permies are trying to pull and/or internal stuff. Dont want to get involved.

[Old Greg]

Ongoing MoO would be a flag for me. I'd question whether the client would allow a substitute, and it sounds like they could well be controlling.

Chances of investigation are low, but I wouldn't want to have to defend it if it were me.

In theory you're probably right, but as you say investigation is not likely. However, business is not always black and white, which is why I would mitigate by sending an effectual Statement of Works every month.

[quackhandle]

What is MoO and D&C?

This should be scary enough, my friend.

qh

[jamesbrown]

Ongoing MoO would be a flag for me. I'd question whether the client would allow a substitute, and it sounds like they could well be controlling.

Chances of investigation are low, but I wouldn't want to have to defend it if it were me.

Yes, with an implied contract only, it's going to be very difficult to stop an investigation early and, ultimately, the working practices will be even more important in this scenario. Based on the limited information provided, the working practices are not favorable at all. I think the OP is skating on thin ice and probably needs to either: 1) risk losing the work by formalizing it or 2) treat it as inside IR35. More generally, working without a signed contract is bad practice, as will be apparent if anything goes south.

[TheFaQQer]

Been there 3 months + QDOS review = probably get away with it. Join IPSE for 'insurance' against investigation.

IMO

Ongoing MoO would be a flag for me. I'd question whether the client would allow a substitute, and it sounds like they could well be controlling.

Chances of investigation are low, but I wouldn't want to have to defend it if it were me.

[Old Greg]

Since you sound like you could well be caught by IR35, what dividends can you possibly pay?

Been there 3 months + QDOS review = probably get away with it. Join IPSE for 'insurance' against investigation.

IMO

[Sausage Surprise]

Personally I'd keep my head down and continue invoicing. I'd worry when the invoices weren't being paid.

[TheFaQQer]

In terms of payment I invoice monthly in advance with 28 days to pay into my business bank account. I'm with an accountancy firm called Boox and they advise me on paying s scary, expenses and dividends

Since you sound like you could well be caught by IR35, what dividends can you possibly pay?

[Old Greg]

Difficult, especially if you want the work.

I think what I would do is: at the start of every month email (from your Ltd's corporate email) your main ClientCo contract and copy the agent and propose the work to be delivered over the next month, inviting comment from both parties.

Not a perfect solution, but may be defensible as an implied contract, and also looks task based, rather than hanging around as a disguised permie.

IANAL and others may have differing views.