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jonno141

subcontracting to the same company

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You can work for one company for as long as you want and be self employed!! What is important is the relationship you have with the company.

 

There are 3 tests for self employment which are control, substitution and mutuality of obligation!

 

You have to control how the work is done, not the company you work for. If you control how the work is done that is a strong indicator of self employment.

 

If you dont have to do the work yourself and can send someone else to do it then that is an absolute indicator of self employment.

 

If the company you are working for isnt obliged to offer you continuous work, or you are not obliged to accept any work offered, then that is another good indicator of self employment.

 

You can ignore the bull on the HMRC web site as that is there to get you into employment which brings in more tax and NI

 

Hi there,

 

Without prying, could you advise as to the source of this information which seems sound and authoritative?

 

Thanks in anticipation..

Paul

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as long as yr paying some tax cant see the issue some have with it, but those working wkends cash in hand are the 1,s you need to be preaching too ,imo :001_smile:

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To summarise briefly this e-mail from my accountant is almost a direct lift from HMRC's own guidance.

 

1. You should use your own tools and equipment.

 

2. You should have other “clients”.

 

3. You should not have paid holidays or paid sick leave.

 

4. You should try to avoid regular hours.

 

5. You should retain your own insurances.

 

6. You should issue invoices.

 

The Revenue will decide on status using a points system – there appears to be no definition of self employment. However, the onus and risk is on the “employer” or main contractor – not you in this case.

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Hi there,

 

Without prying, could you advise as to the source of this information which seems sound and authoritative?

 

Thanks in anticipation..

Paul

 

The origins are in case law but explained during a seminar run by an outfit called Accountax. Its also covered in lots of other arenas concerning IR35 and tax status cases.

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To summarise briefly this e-mail from my accountant is almost a direct lift from HMRC's own guidance.

 

1. You should use your own tools and equipment.

 

2. You should have other “clients”.

 

3. You should not have paid holidays or paid sick leave.

 

4. You should try to avoid regular hours.

 

5. You should retain your own insurances.

 

6. You should issue invoices.

 

The Revenue will decide on status using a points system – there appears to be no definition of self employment. However, the onus and risk is on the “employer” or main contractor – not you in this case.

 

Self employment is defined in law but the principle tests are in post 10. The revenues take is marketing bull and NOT supported in case law!!

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Good post and I agree with what your saying but most freelance/subbie groundies and climbers are not going to pass those tests..

 

There are 3 tests for self employment

You have to control how the work is done, not the company you work for. If you control how the work is done that is a strong indicator of self employment.

A Climber might get away with it. If they have own kit. But a free lance goundie...?

 

If you dont have to do the work yourself and can send someone else to do it then that is an absolute indicator of self employment.

Not sure I would be happy if I had booked fred and he sent his mate, I can't see that happening

 

If the company you are working for isnt obliged to offer you continuous work, or you are not obliged to accept any work offered, then that is another good indicator of self employment.....

The OP has been offered to contract "for a while.." Presumably he will be expected to turn up.

 

Don't get me wrong as an employee if your happy with the situation your paying your tax etc, then you nothing to worry about. It's the employer who will get shafted..

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Point 2 from above: You should have other clients....

 

Well the guy has been offered full time work "for a while" so he's not going to have other clients "for a while"

 

I think it depends on how long "a while" is? If its a year then you wont have 25% of invoices from "other clients". But if you pay your tax you might be ok. Its the employer thats in the wrong.

 

If they want you for a while, then employ you for a while, then stop employing you.

 

Having your own kit doesnt help much, many workers have their own kit. In the building trade all workers have their own kit, but then they are paid under CIS so tax is deducted at source.

 

In some ways it would be better for arbs to be employed under CIS but we dont have to.

 

For now its just a matter of fudging the books and its all ok.

 

If you want to fudge it then dont issue weekly invoices!! Or daily ones, never mention any day rate on your invoices. SO if you get £600 a week, invoice £235, then £485, then etc etc. dont put days worked, just jobs done.

 

Oh, as for insurance! Well, yes, you can have your own insurance if you want, and it might help to show you are self employed, but you dont need it if working with another company. Your not sub contracting as a seperate entity so you dont need insurance.

 

As said before its the company employing you that is dodging the system, they are taking you as self employed so no holiday pay, probably no pay for cancelled wet days, and no gaurantee of 5 days a week. So why on earth anybody would pay for insurance (that wont be valid) to show self employment in order for another company to **** them up the **** is quite beyond me!

 

 

 

 

I may have mentioned this before!

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Good post and I agree with what your saying but most freelance/subbie groundies and climbers are not going to pass those tests..

 

Anyone can pass or fail the tests, but it all depends on the relationship between the client and the worker and whether the two parties want the relationship to be that of employment or self employment.

 

If the client TELLS a groundy to be at a site at a set time, do the job in a particular way, do the job himself and turn up at the yard on an on going basis, then clearly thats employment.

 

If the client ASKS the groundy to support a climber and clear up a job for a few days but is left to sort it out himself, then thats likely to be self employment even though the groundy may be using the clients saws and chipper. In this case the client has no control, or right if control over how the job is run, the groundy could send a substitute(with equal skills) and the work is just for the specific job.

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