Contract with agency

[GoingToTheBeachSoon]

Thanks for the comments. I told the agency I didn't want to go with their proposed solution so the two options, if the client wanted me, were Outside IR35 with end client, or Umbrella at enhanced rate. Client wouldn't budge on outside but has boosted day rate by 25%. Not quite up to standard rate if outside but pretty good. Start Monday ?

[eek]

If you actually want my concern - it's this scenario

Agency says you are outside and you start work

Agency issues a SDS status change (via an "appeal") prior to the end client paying their first bill which says that the contract is inside.

The invoice in your third and 4th months is lost from the tax due in months 1 and 2 that you didn't pay.

All the above is perfectly possible under the IR35 rules and was one of the "real" moments contained in the HMRC seminar both me and JamesBrown attended.

[NotAllThere]

Doesn't matter what size the agency is - what matters is the size of the end client...

Yes. It does - naughty nat - advice to the OP, so long as the end client is not small, go for it. Nothing to lose. Except the agency may lose their client when the client finds out.

[eek]

Is the agency a bigco, subject to the new legislation. If not, the liability lies with you.

Doesn't matter what size the agency is - what matters is the size of the end client...

[NotAllThere]

Is the agency a bigco, subject to the new legislation. If not, the liability lies with you.

[northernladuk]

So there are two ways they've created this solution. One is where they've discussed it with the client and have both agreed that the agency will be providing a managed service solution to the client for a fixed cost or the other option where the agency are just taking the piss and creating a convoluted setup to try make the situation look like something it isn't.

You can bet your bottom dollar it's the latter and you'll just be on client site doing exactly what you would be doing inside. I'd be there is a bigger cut from your take home compared to outside as well. This sounds very much like the days when people like Hyphen were hoovering up Barclays gigs and taking on unsuspecting contractors to do the work while they pay a much lower wage. This was a very thinly veiled set up back in the day when IR35 didn't really matter. Now there is legislation in place it's almost negligent.

It's this type of stuff that's gonna get HMRC start up up investigations again IMO. Very poor from the agency.

In order of preference I'd say you 1) Leave it alone and go get something else 2) If you have to take it go inside as normal 3) if you are really desperate entertain them but be very aware this could very likely bite you at some point in the future. Did I say I'd only consider 3 if I was really desperate?

[malvolio]

The agent's concern is to secure their commission, not the accuracy or legality of the contract. Look at it from that perspective...

[ladymuck]

Hmm... does sound suss if the Client has already done the assessment.

What about the contract and working practices has changed in order for it to now be outside? If it's been truly repackaged as a proper service provider agreement then it could be fine but it needs to be carefully checked to make sure it's not a sly dodge.

[GoingToTheBeachSoon]

Me > Agency > Client

Possibility of coming off the bench.

Client has determined the role should be Inside IR35. Agreed rate would be fine with me if outside, but as things stand I'm going to pass. Agency has now come up with a "solution", where I would work directly for them as a consultant and they would assess the role as Outside IR35. The Agency say they have diligently assessed the role and genuinely believe it to be outside. I've asked for a copy of their contract and to see a Status Determination Statement. This all sounds a bit dubious to me but if they are willing to take all the risk why shouldn't I proceed?