Reply to: Client wants contract changed.

[TheFaQQer]

However if HMRC were investigating your expenses and looked at your current contract I strongly doubt they would say that. I would just get an end date put into the contract anyway to be on the safe side.

I would go for an end-date too.

However, I would still like to think that I could argue that there was never an intention to work in the same location for over 24 months.

[pmeswani]

It does.

The expenses rule thing is complex.

Indeed. The following article (sorry if the site is a rival company) <snip> says something about a significant break, I wonder if anyone here has exercised that idea?

[SueEllen]

The two year rule only kicks in when you have an expectation that you will be there for more than two years.

If I expect to be there for 18 months and then leaving, I don't see how the two year rule can apply, whether there is an end-date to the contract or not.

However if HMRC were investigating your expenses and looked at your current contract I strongly doubt they would say that. I would just get an end date put into the contract anyway to be on the safe side.

[SueEllen]

Doesn't it depend on whether you have worked in the area in general for 24 or more months? ie. Client co 4 months, holiday 3 months, contract for 16 months followed by an extension of 1 or more month would mean that the 2 year rule would kick in, irrespective of whether it is the same client co or not. It's the area that matters.

It does.

The expenses rule thing is complex.

[pmeswani]

The two year rule only kicks in when you have an expectation that you will be there for more than two years.

If I expect to be there for 18 months and then leaving, I don't see how the two year rule can apply, whether there is an end-date to the contract or not.

Doesn't it depend on whether you have worked in the area in general for 24 or more months? ie. Client co 4 months, holiday 3 months, contract for 16 months followed by an extension of 1 or more month would mean that the 2 year rule would kick in, irrespective of whether it is the same client co or not. It's the area that matters.

[TheFaQQer]

You wouldn't be able to claim expenses as the workplace isn't temporary.

I would get a contract end date in it regardless for IR35 this is more important than the expense thing.

The two year rule only kicks in when you have an expectation that you will be there for more than two years.

If I expect to be there for 18 months and then leaving, I don't see how the two year rule can apply, whether there is an end-date to the contract or not.

[SueEllen]

Another clause mentions:

This Agreement shall commence on 20th May 2010 and shall continue until the parties terminate this agreement

Trying to be helpful, I wonder what HMRC's view would be about the 2 year rule for expenses if you sign up to an open-ended contract though I realise it might not be much of an an issue if your client is close to home?

You wouldn't be able to claim expenses as the workplace isn't temporary.

I would get a contract end date in it regardless for IR35 this is more important than the expense thing.

[PSK]

Another clause mentions:

This Agreement shall commence on 20th May 2010 and shall continue until the parties terminate this agreement

Trying to be helpful, I wonder what HMRC's view would be about the 2 year rule for expenses if you sign up to an open-ended contract though I realise it might not be much of an an issue if your client is close to home?

[pmeswani]

Nah you're not wrong it is an IR35 pointer

Just I don't fit under the "standard" contract as client co for me authorises say 50 days and I work those off along with 2 other clients. I also get to choose what days I work - hwoever the agency doesn't seem to get this so I get a standard contract.

That does help. I would offer to swap, but I doubt that you would want to anyway.

[Sockpuppet]

Hmmm... I have been led to believe that stating hours in the contract is a IR35 pointer (of some sort) and that the contract should state the number of hours, rather than the actual hours required. I know with shift work, one would be required to work during certain hours, but that was the exception rather than the rule. I know the working hours on its own isn't an IR35 fail, but I been led to believe (can't remember by whom or when, sadly) that can be an IR35 pointer. If am wrong, then fair enough.

Nah you're not wrong it is an IR35 pointer

Just I don't fit under the "standard" contract as client co for me authorises say 50 days and I work those off along with 2 other clients. I also get to choose what days I work - hwoever the agency doesn't seem to get this so I get a standard contract.

Since it's the reality of the situation rather than the written word, then it's pretty irrelevant in your case

I wonder if HMRC would that that view. My guess is they'd favour whichever of the reality or the written word the think would make their case the best.

[TheFaQQer]

So are you saying I should keep away from the set hours?

Another clause mentions:

This Agreement shall commence on 20th May 2010 and shall continue until the parties terminate this agreement

Are contracts with no real end OK, or should I be asking for a new 3 month contract every time?!

Personally, I tend to shy away from an open-ended contract, but it's just my preference. If I'm in contract, then I tend not to look for other opportunities, so if I was in an open-ended contract then subconsciously, I'd be there forever. If I have an end-date to work towards, then I can gear up mentally for looking for new work.

From a certain point of view, an open-ended contract might look more like one of employment, though. I'd get it reviewed professionally.

[TheFaQQer]

I hope not as my contract says I should do "A professional working day is for 8 hours per day commencing at 8:30 am and finishing at 5:30pm, with one hour for lunch break, Mondays to Fridays, excluding Bank Holidays." but I rarely do these hours. Then again it also says I work in London.

Overall accuracy doesn't seem to be a feature of this contract.

Since it's the reality of the situation rather than the written word, then it's pretty irrelevant in your case

[pmeswani]

I hope not as my contract says I should do "A professional working day is for 8 hours per day commencing at 8:30 am and finishing at 5:30pm, with one hour for lunch break, Mondays to Fridays, excluding Bank Holidays." but I rarely do these hours. Then again it also says I work in London.

Overall accuracy doesn't seem to be a feature of this contract.

Hmmm... I have been led to believe that stating hours in the contract is a IR35 pointer (of some sort) and that the contract should state the number of hours, rather than the actual hours required. I know with shift work, one would be required to work during certain hours, but that was the exception rather than the rule. I know the working hours on its own isn't an IR35 fail, but I been led to believe (can't remember by whom or when, sadly) that can be an IR35 pointer. If am wrong, then fair enough.

[NotAllThere]

Moved to Business/Contracts.

Work out how much extra tax you'll have to pay if your contract is IR35 caught. Then tell the client that that's how much extra they'll need to pay if they want the change.

[Sockpuppet]

It's ok by IR35, as long as it doesn't dictate what hours you have to do (i.e. 9 to 5:30, etc).

I hope not as my contract says I should do "A professional working day is for 8 hours per day commencing at 8:30 am and finishing at 5:30pm, with one hour for lunch break, Mondays to Fridays, excluding Bank Holidays." but I rarely do these hours. Then again it also says I work in London.

Overall accuracy doesn't seem to be a feature of this contract.