Reply to: IR35 help

[Wanderer]

There's a detailed guide on the PCG website. Of course, you have to be a member to see it...

The guide on the PCG website says a lot of vague nothing in my opinion. The only useful bit of information is that it's unlikely to affect your IR35 status.

I get the feeling that the PCG lobbied so hard for the opt-out that they feel they have to promote it. Hey, look how powerful we are - we lobbied parliment and got an opt-out which is useful for, well, nothing really.

It was a bit of a pyrrhic victory because they haven't secured anything of any real value. Indeed, it has negative value in most cases as it adds risk to small business people.

[malvolio]

Ermmm, if you are through an umbrella, you are an employee anyway, albeit one who also pays Employers' NICs. IR35 doesn't come into it.

In fact you make more take home inside IR35 through YourCo than you do through an umbrella, but let's not stir that one up again.

[mudskipper]

Hi guys,

A little confused and a bit worried here. I understand what IR35 is but don't have much experience with it.

I started working for an agency a week ago but haven't signed anything yet. (Yes I know - stupid). But they are a large agency and pretty reputable, so I'm not too worried about not getting paid.

The agency guy said that most of his clients "opt out". Which I guess means opting outside of IR35. I said I'd opt in because that's what I've always done with my previous agency and got paid through an umbrella. The agency guy asked why I opted in and he said that 95% of his client opt out. So I opted out.

Anyways, he forwarded me onto Paystream (yes I know - are they that bad?) because I need to get paid weekly and Paystream said that the contract is opt IN and that they would recommend that instead anyway.

What is going on here? Just a bit of miscommunication between my agency and Paystream or is there a common dodgy theme here?

Thanks.

As others have said, opting in/out is nothing to do with IR35. If you are operating through an umbrella, you are inside IR35.

Opting in/out refers to agency regulations. I don't have personal experience, but my understanding (from reading the links posted here) is that, unless you opt out before you've been introduced to the client (which clearly hasn't happened in your case) you are technically opted in anyway regardless of what you sign.

[malvolio]

"A more informed question?" If I knew anymore, I wouldn't need to come here for help.

Has anyone got a direct link to the info. I searched on your site and can't find it.

I did.

http://www.lpwcs.com/wordpress/2009/...e-the-options/

You may like to note one line - It is absolutely nothing at all to do with IR35 and has no impact on your status.

Want to try again?

There's a detailed guide on the PCG website. Of course, you have to be a member to see it...

[northernladuk]

So there's no good reason for me to opt out then?

You haven't read or digested anything that has been posted to help you have you?

[TheFaQQer]

So there's no good reason for me to opt out then?

Personally, I don't believe so. In your case where you are going through an umbrella anyway, I'd say doubly so.

Being opted out may (and I deliberately say "may") be an indication that you are taking risk, and therefore not an employee, thus helping an IR35 defence. However, it's such a minor thing, that I cannot see the benefits of opting out.

For reference, some agencies will only offer an IR35 friendly contract if you opt out. I had a big argument with an agency some years back about it (linky) where I only got a decent contract by threatening to walk and to ring the client to explain why.

[Branded]

No - you can work directly for the client, but the period that you are contractually restrained from working for them may be different from that dictated by the regulations.

However, in practice it's a moot point - most agencies will have a contract with the client that prevents them from taking you on direct anyway.

So there's no good reason for me to opt out then?

[TheFaQQer]

Yeah, this is exactly what it is. Now I believe the reason is that it's better for the agency rather than myself.

If I opt OUT:

1. They can refuse to pay me if the client doesn't pay up.
2. I can't work for the client directly.

No - you can work directly for the client, but the period that you are contractually restrained from working for them may be different from that dictated by the regulations.

However, in practice it's a moot point - most agencies will have a contract with the client that prevents them from taking you on direct anyway.

[Branded]

You cannot 'opt-out' of IR35. You can opt out of the The Conduct of Employment Agencies and Employment Businesses Regulations

Yeah, this is exactly what it is. Now I believe the reason is that it's better for the agency rather than myself.

If I opt OUT:

1. They can refuse to pay me if the client doesn't pay up.
2. I can't work for the client directly.

[TheFaQQer]

The agency guy said that most of his clients "opt out". Which I guess means opting outside of IR35.

Yes - it's that easy to get out of IR35. You just opt out of it. If only that Dragonfly guy had thought of that, eh.

[Ardesco]

I prefer this link:

http://lmgtfy.com/?q=contractor+opt+in

[northernladuk]

Ithangyew....

Grrrrrrrrrrrrrr

[cojak]

That's very restrained. Well done.

Ithangyew....

[Moscow Mule]

Here's information from this very website.

That's very restrained. Well done.

[Wanderer]

A long item, summed up as:

Overall, I find it difficult to see that there is any sound commercial reason why a contractor providing services through an agency would wish to opt out of the new regulations.