Moving on from IR35 irritation, to action

[1] The one exception is ‘small’ companies, who will not be affected by the reform.

[2] According to Mercer's latest Global Talent Trends study, 79% of executives expect that contingent and freelance workers will substantially replace full-time employees in the coming years.
[3] The vast majority of independent consultants, 86% are satisfied with working as an independent, and are more satisfied than employed consultants with their current professional life.
[4] Off-payroll working: How IR35 rules affect the private sector | Legal guidance | Tools | XpertHR.co.uk

A master services / framework agreement for the provision of consultancy services, in conjunction with

A statement of work for each project.

Given the nature of the work and the degree of control we have over full service and managed capability consulting projects, we expect the majority to fall ‘outside’ of IR35. However, we do anticipate that some of our interim consulting assignments will be deemed ‘inside’ of IR35 due to client policies or working practices and in these instances this will communicated at the outset and consultants will likely be asked to work through an umbrella company for this.

We welcome the recent HMRC briefing which refers to planned improvements to the CEST tool, now due for release in December 2019, but under current guidance, for an opportunity to be considered ‘outside IR35’, there are 3 main conditions, any of which would deem an engagement to be ‘outside’ of IR35:

There must be a right of substitution. The consultant can provide a substitute if he/she is unable or unwilling to do the work and the client has no right of veto as long as substitute has the right skills/qualifications. The original consultant must bear the costs of this substitution.

The client does not supervise, direct or control how the consultant delivers the services . Our consultants will work to the scope, objectives and deliverables agreed between B2E Consulting and the end client, but they will use their own expertise to decide how the work is performed and to some extent, where the work is performed e.g. split between home office and client site working.

There is no mutuality of obligation. There is no obligation, at the end of the current contract, for the client to offer more work to B2E/the consultant and if more work were offered, there is no obligation for B2E/the consultant to accept such work. Similarly, during the existing contract, there is no obligation for the consultant to provide any services outside of those documented on the Statement of Work; if the client requires different/additional services, these need to be the subject of a change request to the existing contract,

There are other considerations including:

Part and parcel: Consultants must not be treated as employees and should not receive the same benefits as employees for example they should not attend staff meetings/staff Xmas parties etc and should not use subsidised staff canteens/sports facilities etc.

Financial Risk: Consultants should demonstrate some financial risk around delivery of the services - e.g. if rework is required, it should be done at the consultant’s own cost and expense.

Exclusive Service: Nothing in the contracts should prevent the consultant from performing paid work for more than one client concurrently (related to ‘control’).

Provision of Equipment: Consultant should provide their own business equipment to enable them to deliver the services for which they have been engaged. Although it is accepted that in actual practice, the client may provide a PC from an IT security point of view,

Being in Business on the Consultant’s Own Account - being VAT registered; having their own PI and PL insurances, having work email address etc.

[5] https://www.qdoscontractor.com/docs/default-source/resources/contractor-guide-to-ir35-reform.pdf