HMRC have published guidance relating to “contracted-out” services (also known as “outsourced services” or a “Statement of Work”).
This guidance supplements previous guidance which provided examples of what constitutes a genuine contracted-out service. It also reiterates that where the parties engage under this model, the “client” for the purposes of Off Payroll will be the service provider (unless they are a small company), not the end client, because the service provider is the party that the worker is providing their services to, and will most likely be the party akin to the worker’s employer.
The guidance also advises parties considering this model that they must understand what constitutes a genuine fully contracted-out service- this is an assessment based not only on the contractual documentation but on the commercial reality of the arrangement.
If you are interested in providing your services to your clients under a SOW, or are an agency or client considering engaging with your supply chain under this model, please contact us at WTT Legal for a free consultation.