Reply to: IR35 - Potential client can't fill perm role

[Hobosapien]

You need a Confirmation of Arrangement's letter for that. It's mentioned here by QDOS and I am sure there is a template on their site somewhere but I actually have to do some work for my client this morning so you'll have to go find it.

https://www.qdoscontractor.com/news/...f-arrangements

It's not a golden bullet and it's very dependant on getting the right answers and ultimately the right person signing it. I try to get one of these at every gig but only had one or two signed and one of those I suspect wasn't the best person. No chance in a PS!

Thanks for the info, very interesting for future reference.

The QDOS one I did was a PS specific pack that resulted in a certificate to hand to HR, when they started requiring IR35 assurances following that Danny Alexander review (I think) and no such confirmation doc was included in the pack.

[northernladuk]

Yes it was just a questionnaire for me to complete without any requirement to get proof from the client.

Opens up the possibility of the client giving a different view if they're ever questioned directly by HMRC. I know that issue has been covered on here before as it's always been in the back of my mind. Maybe I should have tried getting it signed by my 'handler' at the client even though not requested by QDOS, as a bit more evidence that the working practices were for real. Not sure getting it signed would have been straightforward though, a bit more to it than just signing a time sheet.

You need a Confirmation of Arrangement's letter for that. It's mentioned here by QDOS and I am sure there is a template on their site somewhere but I actually have to do some work for my client this morning so you'll have to go find it.

https://www.qdoscontractor.com/news/...f-arrangements

It's not a golden bullet and it's very dependant on getting the right answers and ultimately the right person signing it. I try to get one of these at every gig but only had one or two signed and one of those I suspect wasn't the best person. No chance in a PS!

[Hobosapien]

Yep. It's your risk so it's up to you how you approach it and I am sure most are fine. It is a self provided assessment though (isn't it) and it's going to be biased because you already think you are outside. If you fill it in so you pass it's not going to really reflect the actual situation. HMRC will come and rip it apart so it's only as good as how realistic you are. That said it's enough for them to insure you so that's all you need really I guess.

Most on here are savvy enough to come for help so will follow the steps as you mention, a couple will fill it in wrong but there are a crap load of people out there that haven't a clue or don't care about IR35. Although we bang on about it on here a lot I think a majority on here are a tough catch for HMRC. Plenty more uninsured permatractors out there for them to chase.

Yes it was just a questionnaire for me to complete without any requirement to get proof from the client.

Opens up the possibility of the client giving a different view if they're ever questioned directly by HMRC. I know that issue has been covered on here before as it's always been in the back of my mind. Maybe I should have tried getting it signed by my 'handler' at the client even though not requested by QDOS, as a bit more evidence that the working practices were for real. Not sure getting it signed would have been straightforward though, a bit more to it than just signing a time sheet.

[northernladuk]

The QDOS review (and I presume the other similar review services) requires details of working practices for them to make the assessment. They passed the review of my current contract on working practices despite the standard issue contract being borderline (open to interpretation by HMRC) on some of the terms.

Yep. It's your risk so it's up to you how you approach it and I am sure most are fine. It is a self provided assessment though (isn't it) and it's going to be biased because you already think you are outside. If you fill it in so you pass it's not going to really reflect the actual situation. HMRC will come and rip it apart so it's only as good as how realistic you are. That said it's enough for them to insure you so that's all you need really I guess.

Most on here are savvy enough to come for help so will follow the steps as you mention, a couple will fill it in wrong but there are a crap load of people out there that haven't a clue or don't care about IR35. Although we bang on about it on here a lot I think a majority on here are a tough catch for HMRC. Plenty more uninsured permatractors out there for them to chase.

[northernladuk]

Not sure we've had many on here been involved in an IR35 investigation while covered by QDOS (or alternative) review and insurance?

Maybe having done that due diligence gives a high enough barrier to entry for HMRC to look elsewhere for easier pickings, presuming they understand that passing the review means a positive result for them ought to be less likely, and there are plenty who don't bother doing the due diligence.

Though not sure HMRC would know in advance of a review having been done unless it was via their own service, unless there's some info sharing going on behind the scenes. So it may be the first weapon to use if an investigation is triggered like swatting a nasty pest away. Then if they persist then invoke the insurance and hope it stand up to scrutiny.

As with any insurance you only find out its worth when you come to need it.

We've had 3 or 4 mention it, one quite recently. 4 in 13k with each one being years of investigation and the potential to lose 10-100's of K of money.. Those are terrible odds. IMO take IR35 very seriously and you'll be safe.

I believe the common understanding is it can follow a tax investigation or someone dobs you in it. I do think times are changing now and data sharing is going to be a threat (only if you are doing it wrong) so could be much easier in the future to target.

QDOS pop on from time to time and give us some insight in to the number of investigations and the like (not actual figures) so it is real. The only post I can find from them is http://forums.contractoruk.com/accou...tml#post270098

In there they say it's never a certainty to win so 4/13 and you are on the backfoot from the start.. The picture get's worse. They also say make a comment on TLC35 about a working practice assessment. This assumes the contractor is honest and is realistic... Which I bet most aren't.

[Hobosapien]

Bearing in mind working practices trump the contract do you not think it would be wise to look in to it a little better?

The QDOS review (and I presume the other similar review services) requires details of working practices for them to make the assessment. They passed the review of my current contract on working practices despite the standard issue contract being borderline (open to interpretation by HMRC) on some of the terms.

[Hobosapien]

Not sure we've had many on here been involved in an IR35 investigation while covered by QDOS (or alternative) review and insurance?

Maybe having done that due diligence gives a high enough barrier to entry for HMRC to look elsewhere for easier pickings, presuming they understand that passing the review means a positive result for them ought to be less likely, and there are plenty who don't bother doing the due diligence.

Though not sure HMRC would know in advance of a review having been done unless it was via their own service, unless there's some info sharing going on behind the scenes. So it may be the first weapon to use if an investigation is triggered like swatting a nasty pest away. Then if they persist then invoke the insurance and hope it stand up to scrutiny.

As with any insurance you only find out its worth when you come to need it.

[northernladuk]

Which everyone tends to forget on here....

I've been the same. Contract passed by QDOS. IPSE insurance.

Yes working practices might be iffy and since its BAU it might be iffy too.

Not saying its never going to happen but I dont think many, who have QDOS/IPSE, have been unfortunate.

Bearing in mind working practices trump the contract do you not think it would be wise to look in to it a little better?

[psychocandy]

I did a contract for over two years which was originally offered as a perm role but was switched to a contract when I refused it. Sent all of the information to QDOS and they insured me without any hassle (couple of words needed changing in the contract but that was it).

Which everyone tends to forget on here....

I've been the same. Contract passed by QDOS. IPSE insurance.

Yes working practices might be iffy and since its BAU it might be iffy too.

Not saying its never going to happen but I dont think many, who have QDOS/IPSE, have been unfortunate.

[Hobosapien]

Indeed but understanding exactly who to negotiate with and who's money you are attempting to get the rise from is pretty fundamental.

That seems pretty straight forward in that the client is the one with the money and it's the agency that one negotiates with, but I can see your point about how the agency may be easier to squeeze on margin. Though even they will have a limit on manoeuvrability before they have to go back to the client, as it would be exceptional circumstances for them to agree to zero commission.

I suppose the results depend on the client company. The less well managed or those with a big reward for delivering a project on time may blow the initial budget to get the bigger payoff.

I've seen this where a client had won a government tender worth lots and they were at risk of missing a deadline so all us contractors already on board got all sorts of additional rewards either at renewal time, them agreeing to the higher weekend rate, or simply them providing free pizzas when working longer hours than the norm. They at least had the sense to know that it was better for them to keep us happy than to try to throw more bodies at the problem. We did get the project done in time, though definitely not on their original budget, but they were happy enough. So much so they made several of the contractors permie when the Y2k downturn occurred towards the end of the project and those contractors were worried about the work drying up.

[MyUserName]

I did a contract for over two years which was originally offered as a perm role but was switched to a contract when I refused it. Sent all of the information to QDOS and they insured me without any hassle (couple of words needed changing in the contract but that was it).

[northernladuk]

:t the end of the day we're a disposable resource so shouldn't worry too much about the client's feelings, other than to do a good job at what we were contracted for. Negotiation and renewal tactics are pretty much whoever dares wins if you are willing to accept the loss of contract and potentially on bridge burning terms.

Indeed but understanding exactly who to negotiate with and who's money you are attempting to get the rise from is pretty fundamental.

[Hobosapien]

Yeah ok

I've got better things to do than argue in fantasy land.


Edit: Fair enough, we all have different approaches and some of my 'ideas' haven't been proven on the battleground. I know some of what I wrote is fact though through experience (will leave you to work out which bits are less close to fantasy ), all clients aren't the same.

At the end of the day we're a disposable resource so shouldn't worry too much about the client's feelings, other than to do a good job at what we were contracted for. Negotiation and renewal tactics are pretty much whoever dares wins if you are willing to accept the loss of contract and potentially on bridge burning terms.

[LondonManc]

Moaning about expensive hotels is even worse! You knew that when you started so should factor it in. Blackmailing a client about your hotel costs is no better. Although I don't like it at least a change in tax status or T&S is a change so could warrant a change in rates. Complaining the hotels you've been in from day one are expensive and using that as an excuse isn't clever.



And it's not even a 'nothing to lose' card. It's business. It's not that smart holding your client over a barrel like that but if that's what you want to do at least stick it to them straight without moaning about tax status or hotel prices. Again knowing who you going to get the rate rise out of here is key as mentioned above.

The two year rule on T&S is a decent reason - multiple projects, same large multinational, same site, different departments, etc.

[northernladuk]

Only a muppet would show their hand like that.

Usually there are other circumstances you can use as an 'excuse' to request a rate increase that may be more sympathetically received, such as the client being based where the hotels are expensive so you need an increase or WFH to continue.

Moaning about expensive hotels is even worse! You knew that when you started so should factor it in. Blackmailing a client about your hotel costs is no better. Although I don't like it at least a change in tax status or T&S is a change so could warrant a change in rates. Complaining the hotels you've been in from day one are expensive and using that as an excuse isn't clever.

Or just play the 'nothing to lose' card and say you want x extra or you're not renewing. No reason needs to be given. You could even say you found out others are on x rate and you want same. Lots of approaches depending on situation and number of agencies involved at client.

Though these work regardless of IR35 status and real motivations.

And it's not even a 'nothing to lose' card. It's business. It's not that smart holding your client over a barrel like that but if that's what you want to do at least stick it to them straight without moaning about tax status or hotel prices. Again knowing who you going to get the rate rise out of here is key as mentioned above.