Outside IR35 Contracts

Outsourcing of Statements of Work

Our contracts are categorized as “Outside IR35” and we create a real statement of work (SOW) solution for all kinds of enterprises located in United Kingdom.

What does a work statement (SOW) actually mean?

In recent years, a number of operators have entered the market, claiming to offer “true” SOW solutions. Although there isn’t a predetermined format, a strong statement of work would include a “contract for services“, which regulates the cooperation and outcomes determined between the company and Excelapps Projects.

In addition to previously agreed-upon Terms and Conditions, each party would specify the scope of work and commercial arrangements, including costs, deadlines, and product specifications.

Issues including project misalignment, fluctuating costs, a lack of control, inefficiency, and inconsistent quality are all addressed by an outcome-based SOW. It is clear why performance-based work packages make sound commercial sense when these aspects are taken into account.

Benefits of Outsourcing a SOW

Using SOWs effectively allows organizations to acquire the greatest people, receive the best deliverables, and avoid extra costs and the hassle of IR35 compliance.

Cost & Control

Issues including project misalignment, fluctuating costs, a lack of control, inefficiency, and inconsistent quality are all addressed by an outcome-based SOW. We assume project responsibility by establishing assured deliverables, on schedule, and under strict budgets, which contributes to considerable project cost savings by eradicating unnecessary work or rework costs.

High quality and prompt delivery

Utilizing a pool of competent individuals and managing those teams to deliver against rigid KPIs and objectives, Excelapps Projects administers the contract for services and assumes either entire or mutually agreed-upon responsibility for the effective delivery of a project. Our customers can unwind knowing that we are in charge of overseeing the entire scope of work. It is supplied in accordance with predetermined timelines and checkpoints, with the Excelapps Projects team assuring the best delivery possible at each stage.

IR35

As the final client, Excelapps Projects is responsible for IR35 compliance and the risks involved. A legitimate description of work cannot be utilized to pass off the provision of labor as a consulting agreement; rather, it must be truly outsourced. This approach necessitates that we use reasonable caution and fairly evaluate the tax status of any Persons or PSCs we engage, which is a desirable requirement for our clients.

How does Excelapps assist me with IR35 contract?

The best news for our British clients is that we meticulously follow the IR35’s main principles, thus all of our projects are IR35 compliant and are regarded as outside. To do our contract evaluation for outside IR35 on our contracts and make sure we are compliant, we have worked with a trusted third party.

Devices / Business Laptops: In an ideal world, every member of our staff would have their own laptop. However, in the event that any of our clients ask for their own business laptop for project development so they can access the business secure servers, code repositories, or sensitive information out of concern for the privacy and security of their data, we will oblige. The client’s laptop is picked up by our collection member and delivered to our team, with a clause allowing them to be replaced by another worker we believe is qualified to work on your project. Upon completion of the project or agreement, the laptop is delivered back to our client’s office.

All of our employees report daily to our IT project managers under direct supervision from Excelapps, and they typically work from 9 am to 5 pm in our office. Following this, the final project progress updates are then communicated to our clients via the project managers and leads involved in the project.

Frequently Asked Questions on IR35

The top queries on the IR35 from clients in the United Kingdom are given below.

Key rules for IR35

The client (you) will determine whether the role falls under or outside of IR35 based on a few key rules.

• Control: Will the contractor have control over the when, how, and location in which they carry out their work?
• Right of substitution: Can the contractor outsource the responsibilities given to them?
• Financial risk: Will the independent contractor bear any financial risks associated with rendering the services?
• Exclusive service: Is the contractor permitted to simultaneously work on other projects and give services to other end clients?
• Included benefits: Does the contractor have access to staff social events, facilities, meetings, and employment benefits?
• Notice period: Is the independent contractor subject to the same terms and notice period as those that apply to employees?
• Equipment provision: Will the employer offer the independent contractors’ equipment, or are they expected to use their own?

It is likely that the workers will be categorized as independent contractors “out of scope” of IR35 if there is evidence that they have control over their work schedule and location, use their own equipment, have the ability to subcontract the tasks, and bear financial risk associated with providing the assigned services.

The workers are likely to be classified as employees and the arrangement is likely to fall “in the scope” of IR 35 if they are entitled to employment benefits, have a dedicated office space in the employer’s offices, use equipment provided by the employer, and their role and responsibilities are not materially different from those of full-time employees. They are also unlikely to be able to subcontract the work.

Does IR35 apply to your company?

According to the government, only medium-sized and large-sized firms will be subject to IR 35 tax compliance for the private sector.

According to the definition provided by the Companies Act of 2006, most private sector enterprises that have a gross annual revenue of over £10.2 million will be subject to this regulation. They must have a balance sheet total of more than £5.1 million. Additionally, the company should employ more than 50 people.

What would IR35 cost my company?

If the position is determined to fall under IR35, the contractor will be treated as an employee for tax purposes. He or she will be subject to PAYE in the same way that regular employees are. Employers will be required by law to withhold and pay both income tax and National Insurance Contributions on behalf of the employee in this scenario.

Compared to the effective tax rates that apply under the Personal Service Company structure, they will be high. If the arrangement falls under the purview of IR35, income tax and NICs will be deducted from the contractor’s gross compensation.

Who is exempt from IR35?

The IR35 reform will begin to apply to medium-sized and large-sized private sector businesses on April 6, 2021. All clients in the public and private sectors who meet at least two of the following criteria are subject to the regulation:
If the company has more than fifty employees, a balance sheet total of more than £5.1 million, or an annual turnover of more than £10,2 million

Along with the aforementioned requirements, the customer is also disqualified from the governmental reform if it lacks a UK entity. Businesses that do not meet the aforementioned criteria are subject to the IR35 exemption. On the other hand, there might be certain exceptions.

Where can I find more information on IR35?

Employers and independent contractors can visit the official UK government website to learn more about the IR35 Act. It is also advantageous to use the online tool offered on the government website to check their IR35 status.