In a recent meeting I asked my client whether he had considered IR35 as a lot of the work carried out was for one customer. While an IR35 proof contract may appear to offer a degree of security it needs to represent what actually happens in reality. I asked a little about the working practices and was pleasantly surprised by the responses:
What basis do you invoice on?
- Generally a price is agreed for a piece of work which may extend for a number of weeks and the way in which it is completed is up to me. Some parts of their programme are training days and those do tend to be done on a day rate, but most work is on a contract basis
Do you take all work offered or do you turn some down?
- There have been a number of occasions where work has been turned down and I have emails exchanges with the customer showing this
If you cannot do all the work, do you subcontract out?
- A number of pieces of work have been subcontracted and when the company is paid, it takes a small cut before paying the subcontractor
Is it entirely up to you to choose how to complete the work?
- Once the contract has been agreed it is a matter of doing the work in the most efficient way, so for example I try to arrange all meetings in an area on the same day rather than making multiple journeys
The answers he gave were unprompted and while there are more indicators of self employment these would be good evidence and all contractors should be actively considering these issues. For earlier articles click on HMRC scoring for IR35 and Status – employed or self employed. This article provides information on some of the factors but may not wholly apply to your situation so you should seek professional advice before taking any steps based on the contents. If you would like advice in this or other areas feel free to call. Alastair Wood, AW Accounting, Gravesend, Kent – Accountants who “speak your language”