New IR35 Benchmark Contract
We published this article on an IR35 benchmark contract created by IPSE and REC a few years ago. However, it is still current and well worth another read for freelancers and helps keep them outside IR35.
The Professional Contractors Group (now IPSE) and the Recruitment and Employment Confederation (REC) are pleased to announce the setting of a new IR35 benchmark contract with their approved contract template for REC member agencies engaging limited company contractors.
The terms of the agreement are specifically for use where:-
– the limited company contractor has opted out of the protection of the Conduct of Employment Agencies and Employment Businesses Regulations 2003 and
– will not be under the direction, supervision or control of the client.
Download IR35 Benchmark Contract Template
REC member agencies, therefore, will be able to download the template from the REC website. Moreover, they may use it for all their qualifying contractor clients. This will include those who are not IPSE members.
Expert advisers vetted IPSE approval of the contract. One cannot modify it, therefore, in any way otherwise it will be invalid. IPSE members will be able to verify this by downloading the approved template from the IPSE website.
IPSE will also publish a list of REC agencies that wish to make it known that they use the IPSE-REC contract.
Beneficial to Agencies
The IPSE chief executive said, “This agreement will be beneficial to agencies, clients and freelance contractors operating outside IR35. We would like to thank the REC for collaborating with us on this important project.
“As the recruitment industry’s representative body, the REC has considerable influence. So we welcome their endorsement of a best practice business-to-business contract.
“Unlike temporary workers, independent contractors operate as businesses. They do not seek the protections accorded under employment law. So, their contractual arrangements need to reflect this.”
IR35 Benchmark Contract Agreement Welcome
The managing director of the REC, welcomed the IR35 Benchmark contract agreement. “Providing legal advice and model documents is an important service that we offer our members,” he said.
“So, we see our co-operation with IPSE and the adoption of this new agreement as part of our ongoing work. It is to highlight the valuable contribution of contractors to the UK economy.
“Clients, agencies and contractors should not be confused or concerned by the outcome of recent employment status cases.That’s if they have genuine business-to-business relationships and the appropriate contract terms in place.”
The new IR35 benchmark contract will be very good news for contractors and their Accountants. It should help. therefore, to keep them outside IR35.
See also How Companies Can Help Contractors Stay Outside IR35
If you know anyone else who would find this article useful, please share it with them using the social media buttons at the top and bottom of the page.
Ad – Contractor Services
When the IR35 changes were implemented in the public sector, rather than just pay the IR35 tax, most contractors inside IR35 decided to take the umbrella company route. If you are inside IR35, or caught by a blanket ban on Limited Company contractors, it would be worthwhile checking to see how much income you would keep using an umbrella company. Just fill out the form below and someone will be in touch to let you know.
If you think you can benefit from using an umbrella company, try the following:-
Best Umbrella Companies for Oil and Gas Contractors / Freelancers
Best Umbrella Companies for IT Contractors
Do you need some professional advice on which umbrella company is right for you? Do you want to get better returns from your Umbrella Company? Fill out the form below to receive expert advice.
For all necessary business insurance, including IR35, try Business Insurance for Contractors
