Raise the status question early
It is the client's liability.
The determination you have to make
Medium and large clients decide a contractor's IR35 status — and can carry the tax if they get it wrong.
How we work
Why a consultancy should raise it
Since April 2021, where a private sector client is medium or large, it is the client rather than the contractor who determines whether an engagement falls within the off-payroll working rules. The client must take reasonable care in making that determination, must provide a status determination statement giving the conclusion and the reasons for it, and must operate a process for disagreement. Where it fails to take reasonable care, liability for income tax and National Insurance can rest with the client.
The response many organisations reached for was the blanket determination: treat everyone as inside the rules and remove the judgement. That is not compliance. A determination made without considering the actual engagement is precisely a failure to take reasonable care, and it has the side effect of costing more and driving away the contractors the organisation wanted. The honest route is to look at the arrangement as it really is.
Which makes it a consultancy's business to scope engagements so they can be assessed honestly. We contract for defined outputs, keep control of how and when work is done within agreed milestones, use our own equipment, work for other clients, and take no position in a client's management hierarchy or disciplinary processes. We document those facts so the determination can be made on evidence. We do not tell a client what their determination should be — that is theirs, and ultimately HMRC's — but we make sure there is something real to determine from.
Our principles
Three beliefs behind the method
Deliverables, not instructed hours
The shape of the work is the evidence.
Refer the regulated matters
FCA, legal and accountancy work.