We are a well-established IR35 specialist and we’ve carried out hundreds of reviews for our clients.
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Same Day or Next Day IR35 Review
To say that IR35 is a complicated piece of tax legislation is an understatement! IR35 resembles other similar but virtually the same legislation such as the “off payroll” rules that affect public sector workers and “intermediaries legislation”; there is also “disguised employment” and even to an extent CIS legislation for subcontractors in the construction industry.
They all boil down to the same thing: the status of a contractor is affected by how she or he operates as a contractor and the wording/content of contracts signed.
Contractors should protect themselves against falling foul of IR35 and all the other legislation like it, and, therefore, contractors must make sure they operate as a contractor (that is as a business) and keep a constant eye on their IR35 status. Also, as a matter of course, contractors should take out tax investigation insurance.
Protect yourself by requesting a review:
The most effective way for contractors to protect themselves in the short-term and in the long-term is to request the DNS IR35 and Public Sector Contract Review Service. This provides a detailed report offering appropriate amendments and improvements to the wording of contractor contracts.
The review also considers the day-to-day working practices of the engagement undertaken by the contractor and concludes with either a “pass” or “fail”; We provide expert advice whatever the result.
The first thing HMRC asks for if a contractor falls foul of IR35 or off payroll rules is copies of contracts relating to specific tax year(s), plus any other evidence and information to support the status of contractor.
It is essential, therefore, that contractors take all necessary steps to protect themselves now, by getting each and every new contract reviewed by a member of the expert IR35 contract review team at DNS.
How does the IR35 and Public Sector Contract Review Service work?
Fill out the form providing all the details we ask for and send all the documents we request;
Our independent tax experts review your contract(s);
A full report is produced on the basis of the information provided. This will focus on all relevant clauses.
You will be updated regularly on the progress of your contract review and will receive a written summary of the status of your engagement.
In the report, we will make recommendations for any changes to help enhance and improve the contract itself.
Reviewing your written contract
Contract reviews should provide more than simply an overview of a contractor’s contract or detailed comments on each clause relevant to the review. Contractors will want to know how to fix failing clauses by amending them; and getting the contract amended as and if necessary will need to be agreed with the contractor’s end client or agency. DNS does this on behalf of the contractor.
The terms of the contract must reflect the working practices of the contractor, of course, but there are some essential clauses that must be worded to the letter. These include:
The right of substitution, which should be not be conditional
No named individual should be included in the contract, it is the company/business carrying out the work, and anyone with the right skills from the company should be acceptable as a substitute
Control, the degree of control over the contractor should not be such that s/he could be deemed an employee
Financial risk, the contractor may be asked to correct his/her mistakes; or would not get paid until the contract is met satisfactorily
That there is no obligation, that there is the right to refuse another contract after the current contract ends; and that the contractor is not prohibited from working elsewhere
That the contractor uses his or her own equipment, although this is not hugely significant, it does help to prove independence from the end-client
That work undertaken is invoiced and that invoices for work get paid through the business regularly; and work is undertaken for a variety of clients.
Are your business credentials in good order?
Contractors should make sure they act like a contractor contracting for a business and not like an employee. As working practices provide a better understanding of real working relationships with end clients, and always carry more weight than the contract itself, our review service also assesses contractor working practices in addition to the written contract.
Contractors must make sure their business has:
A letterhead and business card
A website and evidence of other marketing activity
Evidence of undertaking contracts for more than one client
Nothing implies the contractor is an employee, i.e. the contractor does not attend work dos or benefit from the free canteen of the client
The business books and accounts are constantly accurate and up to scrutiny
The business takes out tax investigation insurance
Protecting Contractors
We are a well-established IR35 specialist and we’ve carried out hundreds of reviews for our clients. We are happy to carry out yours, call us on 02035002646 or Contact us to find out how we can help you.
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