Advise needed following contract review

[NotAllThere]

As for getting a higher rate, to be fair to them the client doesn't care about your personal tax situation and certainly isn't going to pay you more to make up for it, and the agent will just say that the client won't pay more. Forget it, in other words.

The OP asked if it would give him leverage with the agency. What the client will pay is irrelevant. He's negotiating with the agency. "I cannot take this contract because it is caught by IR35 - either change the contract, pay me more, otherwise, no deal.", seems to me to be an excellent negotiating position. "I can't take a contract that is not financially viable" is perfectly reasonable.

The agency aren't going to want the deal to go down, even if it means they have to take a cut in their margin. If terms can't be agreed, then that's the way it goes; but there's usually some scope for change.

[The Lone Gunman]

Get the contract changed, and get insurance to cover a loss if taken to court. While Dragonfly was a bit of a blow, there still have been MANY wins against HMRC over IR35, and I'm sure there will continue to be. HMRC have probably got wiser over which cases they'll persue. An non-Ir35 contract together with not becoming part of the organisation is still, in my opinion, a pretty safe bet.

Part of the Dragonfly loss was due to the deliberate nature of the changes made to the contract wording to make it IR35 compliant. I would therefore assume that HMRC will chase this every time they see it.
You have to make sure that any changes you make to the contract are worded in such a way that it makes clear it is not a wording change to the contract but a real description of working practice.

[VectraMan]

The higher contract is the one between the agent and the client. You have no right to see it, and have no control over its content, but in an IR35 investigation it will be used against you.

As for getting a higher rate, to be fair to them the client doesn't care about your personal tax situation and certainly isn't going to pay you more to make up for it, and the agent will just say that the client won't pay more. Forget it, in other words.

[NotAllThere]

Get the contract changed, and get insurance to cover a loss if taken to court. While Dragonfly was a bit of a blow, there still have been MANY wins against HMRC over IR35, and I'm sure there will continue to be. HMRC have probably got wiser over which cases they'll persue. An non-Ir35 contract together with not becoming part of the organisation is still, in my opinion, a pretty safe bet.

[LEX200]

The higher contract is the one between the agent and the client. You have no right to see it, and have no control over its content, but in an IR35 investigation it will be used against you.

Ahh thakns for the clarification TLG!....as you say i cant see it or have control over it, just curious how it could be used against the contractor??

Also, im not going to, but have others in similar stuations gone direct to the client? I know that the agent is having one over on me on the rate as its my first contract, and for the job is well below the market rate, however i was happy to take it for the experience with the assumption that it was outside IR35.

[The Lone Gunman]

Along with the contract i also sent the job description/spec. B&C said that although i didnt have to send it the IR could request it if it ended up in court.

SP, sorry for sounding such a neewb, what do you mean i need to think of the higher contract??

Will see what the agent has to say, if not back to the old job hunting sites

The higher contract is the one between the agent and the client. You have no right to see it, and have no control over its content, but in an IR35 investigation it will be used against you.

[rootsnall]

In light of the contract being inside of IR35, its not financially worth me taking the role, and would be better of staying as a perm.

Sounds like your rate needs upping considerably to make it worthwhile !? The rough rule of thumb is if your salary is say 40K you want to be looking at gross contract earnings of 80K.

[LEX200]

Along with the contract i also sent the job description/spec. B&C said that although i didnt have to send it the IR could request it if it ended up in court.

SP, sorry for sounding such a neewb, what do you mean i need to think of the higher contract??

Will see what the agent has to say, if not back to the old job hunting sites

[The Lone Gunman]

In light of a recent court case (Dragonfly) it is my opinion that changing the wording of the contract to be outside IR35 will lose you any court case should the change be noted.
It is also likely that the contract between agent and client will not be changed

You either have to renegotiate the terms and conditions under which you will work, get the rate upped to negate IR35 costs or walk away.

For the first you need to contact both the agent and the client stating why the original contract is not acceptable then state the terms under which your company will accept a contract. Make sure you get a reply from both parties.
IT IS HIGHLY UNLIKELY THIS WILL HAPPEN.

For the second just use one of the IR35 calculators available online.
IT IS HIGHLY UNLIKELY YOU WILL ACHIEVE THE REQUIRED RATE.

The third is easy. Just say no.

[Sockpuppet]

I'd jump now.

You got to think about the higher contract as well.

[PM-Junkie]

Find out what parts of the contract are IR35 bound and get the pimp to change them in accordance with what the review recommends. If they don't, then walk if it's not financially viable to do the contract.

[LEX200]

Hi Newbie here, just recently been offered my first contract role!! Had the contract reviewed by B&C on Friday and was told that it had failed and that it would be difficult to win if it ended up in court.

In light of the contract being inside of IR35, its not financially worth me taking the role, and would be better of staying as a perm. Does this give me leverage with the agent to up the daily rate?? What have others in similar situations done?

Many thanks for your help