In Business on Your Own Account

In a Nutshell

Confusing

In a Sentence

Whether or not a contractor running their own limited company is caught by the Agency Workers Regulations (AWR) is not exactly clear.

The ‘help' notes that come with the Agency Workers Regulations say that contractors who are in business on their own account will fall outside of the rules. Trouble is what does ‘in business on their own account' mean?

There are different interpretations as to what the key phrase means. Ask 100 experts and get 100 different answers. As with IR35, the guidance can mean different things to different people - not really useful guidance, then.

Black or White

Getting down to basics, AWR is meant to give temporary workers the same basic employment rights & safeguards as permanent full-time staff. Not immediately the assignment starts, but after the first twelve weeks of the contract.

The unhelpful help notes explain: that a temporary worker is excluded if they are in a "profession or business undertaking carried out by the individual". That is the end-client is a real customer of the worker, just like a traditional business arrangement.

Getting Round It

Where the help notes are clear (surprise surprise) is that contractors who may be caught cannot just get round the law by running their own limited company rather than using their agency PAYE scheme or using an umbrella company.

It boils down to HMRC's definition of being self-employed. If the contractor fits the definition exactly then it's likely they'll be outside of the Agency Workers Regulations.

There you go - clear as IR35 mud.