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HMRC internal manual

Employment Status Manual

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HM Revenue & Customs
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Opinions on contracts: engagement not covered by the legislation - model letter

The draft letter is provided for guidance and you should bear in mind that it may not be appropriate and will need adapting in particular cases. You should avoid leaving the enquirer with the impression that their particular queries have not been dealt with and that they are merely receiving a standard response. It is also important to ensure that anything you refer to in your reply is supported by the information you have been provided with.

Where you have been asked for a written opinion on contract and you consider that the engagement would not have been a contract of service if made directly between the client and the worker, then you may base your response on the follow draft reply:

“Dear

Thank you for you letter of… etc.

I have reviewed the contract between (the client) and (the intermediary) and am of the opinion, based upon guidance from the courts in such matters, that had it been a contract between (the client) and (the worker) it would be considered to be a contract for services. As such, the engagement will not be subject to the “intermediaries” legislation.

My reasons for coming to this conclusion are based upon the overall picture presented by the information that you have supplied me with. In particular, the following clauses point clearly towards a contract for services:

…………………………………………………………………………………………………………………………………………………………….…………………………………………………………………………. …………………………………………………………………………………………………………………………………………………………….…………………………………………………………………………. …………………………………………………………………………………………………………………………………………………………….…………………………………………………………………………. …………………………………………………………………………………………………………………………………………………………….…………………………………………………………………………. …………………………………………………………………………………………………………………………………………………………….…………………………………………………………………………. …………………………………………………………………………………………………………………………………………………………….………………………………………………………………………….

[Insert your explanation here along with a full account of the facts on which it is based. Your explanation can be as long as necessary.]

…………………………………………………………………………………………………………..………….……………………………………………………………………………………………………. …………………………………………………………………………………………………………..………….……………………………………………………………………………………………………. …………………………………………………………………………………………………………..………….……………………………………………………………………………………………………. …………………………………………………………………………………………………………..………….…………………………………………………………………………………………………….

My opinion assumes the written terms reflect the true arrangements. If the contract is not fully acted upon in practice or there are other oral or implied conditions, which have not been presented to me, my opinion may be modified. As part of its normal compliance activities, HMRC reserves the right to check that the working arrangements are as set out in the contract.

If you disagree with the contents of this letter, you should tell me why you think it is wrong and provide any further information and/or documentation, which you think, is relevant. I will consider what you have told me and advise you accordingly.”