Contact: 0116 478 3390 info@qdoscommercialservices.com

Ensure you are working with genuine managed-service providers rather than labour-only providers with the help of our specialist team

CONTRACTED-OUT SERVICE REVIEW

WHAT IS A CONTRACTED-OUT SERVICE REVIEW?

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR

Two key questions many companies ask in relation to the off-payroll rules are:

  1. who is responsible for making a determination and
  2. who is liable if that determination proves to be incorrect.

For traditional labour supply chains, the answers to these questions are relatively straightforward. HMRC themselves state that “in most cases it will be obvious who the client is” and that “where a person enters into a contract with an intermediary for the supply of a worker, they will be the client”.

But, as many organisations will know, there are numerous instances where this is less clear cut. As IR35 reform is implemented and then subsequently policed, it is vital that private sector firms take due diligence on both their traditional labour supply chains, but also any alternative arrangements where contractors may be involved.

The Contracted-Out Service Review provides businesses seeking to understand the impact IR35 reform will have on their business, with an independent review of your arrangements/engagements in order to ascertain whether they would be considered genuinely ‘contracted-out’ under the off-payroll rules (in effect as of 6th April 2021).

WHY IS THIS IMPORTANT?

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR

If services are deemed to be genuinely outsourced, the supplier of the services (i.e. the consultancy or agency) is considered the client for the purposes of IR35 and therefore carries the responsibility for determining the status of its contingent workers where they operate through personal service companies.

Examples of arrangements where this should be considered could include (but is not necessarily limited to):

  • Consultancy firms delivering services to clients;
  • Statement of Work (SOW) based arrangements; and
  • Engineering companies delivering projects to an end user.

There are a number of factors that need to be considered when determining whether an arrangement is an outsourced or contracted-out service. If you failed to take due consideration when assessing if the engagement between you and your supplier is out of scope of the legislation, you could be failing your obligations under ‘reasonable care’ and in turn assume responsibility of the fee-payer, and therefore be liable for any unpaid tax on any engagements which should have been assessed.

Given the increase in such arrangements in the lead-up to the implementation of the off-payroll rules, it is likely to be an issue HMRC target. The government’s introduction of a Targeted Anti Avoidance Rule (TAAR) in the final raft of changes to the legislation could be used as a key weapon in this area.

Both the client and supplier must be in agreement as to their opinion of the arrangement. This means you should have that agreement in writing, and it should include specific details of exactly who will manage the responsibility for IR35. Remember that there are some illegitimate suppliers out there who claim to be selling an outside-of-IR35 golden ticket. You should be seeking to engage only with credible, respected, and well-versed organisations who have a background in providing genuine outsourced services.

Policy Design

Contact: 0116 478 3390 info@qdoscommercialservices.com Designed to ensure that your policies/procedures are compliant from an IR35 perspective. POLICY DESIGN WHAT…
FIND OUT MORE

Training

Contact: 0116 478 3390 info@qdoscommercialservices.com Bespoke training packages for your organisation to suit all levels and experience TRAINING Here at…
FIND OUT MORE

IR35 Changes Explained

Contact: 0116 478 3390 info@qdoscommercialservices.com Changes to the IR35 legislation, also referred to as the off-payroll working rules, were implemented…
FIND OUT MORE

WHAT’S INCLUDED AS PART OF THIS SERVICE?

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR

We will review any written contracts (i.e. Master Services Agreement and accompanying Statement of Work) and collect information about the actual working practices and background to the engagement.

Once we have fully reviewed all of the documentation and built up a broad picture of the engagement in question, we will document our findings in an easy to read report, setting out our considerations and rationale behind our overall conclusion and helping you to understand what this means for you and your business going forward.

  • Review of the policies, procedures, and processes around engaging MSPs
  • Review of supplier contracts and relevant Statement of Work (SoW)
  • Review of the working practices between your business and the supplier, as well as understanding the role of contractors within this
  • A custom report covering each supplier reviewed, including comments on both contract and working practice reviews
  • Our expert opinion whether a supplier is a genuine contracted-out service or whether they are, instead, a labour provider
  • Improvements to solidify that a supplier’s provision is as a genuine outsourced service
  • If it is not practically possible to cement a genuine service provision, Qdos can assist you and the supplier in making individual status determinations of the workers
  • Re-review of any changes implemented subject to the initial review findings

WHAT ARE THE BENEFITS?

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR

Ensure Complete Compliance

with a review of your outsourced services.

Demonstrate Due Diligence

with a detailed report of findings.

Establish Responsibilities

by preparing all parties for IR35 reform.

Identify Outsourced Service Providers

with a definitive answer if you are engaging with a genuine outsourced service.

CLIENT TESTIMONIALS

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR
format_quote

Working with Qdos and their IR35 status review tool has had two great advantages over standard agency contact with clients. Firstly it has really helped develop a deeper more consultative relationship (including clients established over 15 years!) and secondly it has given clients the confidence to act pragmatically when looking at the IR35 roll out to the private sector.

It’s great to be able to engage in this way with clients whilst at the same time talk to contractors confidently about their IR35 status moving forward. It is a tool I would thoroughly recommend using when engaging with any of your clients.

Richard Adamthwaite

Sales Director

RequiredIT

format_quote

Since we started working with Qdos we have been continually impressed by their technical excellence and flexible approach to designing bespoke solutions for complex requirements. By combining cutting edge technology with their knowledge of the legislation, they have provided us with an excellent service which has been of considerable benefit to our business and clients. Their knowledge of the market is exceptional and, as a result, they are very proactive and able to offer helpful advice and ideas.

Hays logo

Steve Witts

Group Head of Tax and Treasury

Hays

THE SUPPORT YOU NEVER KNEW YOU NEEDED

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR

Here at Qdos, we have been supporting 90,000+ contractors for well over two decades. When it comes to IR35, you can trust us and our process. We have, after all, spent over two decades fine-tuning our skills.

The most important thing we can provide to you is our expert team. Through them, we can ensure that you are not alone during any part of the process of implementing your IR35 reform strategy. We also offer a range of bespoke training packages to suit the requirements of your business. Ensuring confidence in the knowledge of your employees.

LATEST NEWS & INSIGHTS

QDOS COMMERCIAL SERVICES PROVIDING YOUR BUSINESS WITH THE TOOLS AND RESOURCES TO MANAGE IR35 CHANGES IN THE PRIVATE SECTOR
Menu