B
As a contractor the reality is whether you are a limited company or not is acidemic and this "you have to be a limited company" lark is an attempt by the agencies and some of the service providers to avoid the employer tag.
The big problem that they have all overlooked is that if a guy does some contracting on and off and operates through a company the multinationals don't actually check that the company has not been struck off
I'm not sure if this is correct. I took advice on this question some years ago in relation to a client company and was informed at the time that a struck-off company can trade and (through the directors) can be held accountable for contracts entered into....thus rendering the contract pretty useless.
Presumably you know what you're doing here, but as an practising accountant myself who acts for quite a number of IT contractor clients, I would have grave reservations about how effectively you could protect yourself against any claim by the Revenue or DSCFA that you were de-facto employer of these people and that you were obliged on that basis to operate PAYE/PRSI on their earnings paid through you. I certainly would not involve my own firm in any such arrangement even if there was the slightest doubt that any such claim could arise. Based on the information you have provided, I would fear that such a doubt exists, and I would be concerned that such any tax benefit arising under such an arrangement could be easily invalidated if the Revenue opt at any stage to invoke general anti-avoidance legislation against it.We have got around it by invoicing on behalf of the client. In itself it is not correct as we don't charge a mark up so are invoicing for a service that we have not carried out. (this is whole other argument)
It provides the multinational with an invoice from a company so they are happy. We retain the vat element at the request of our client and pay it directly to the collector general on their behalf and as we prepare the income tax returns for our clients we ensure their taxes are in order. If they decide not ot use us as their tax advisor we insist on getting a tax clearance certificate from them.
Why? Surely in a free country, traders are free to specify trading terms and conditions to suppliers and potential suppliers?I am not even sure it is legal to insist on a contractor operating through a limited company.
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?