28-08-2019
The importance of a written contract

The importance of having a written contract when deciding employment status should not be understated. Failing to make proper provision for written contracts can mean relying on oral agreements, which are obviously much harder to prove. Having a written contract can provide certainty to both parties and help avoid disputes or at the very least make it easier to handle any disputes that arise.

HMRC manuals say that where there is a written contract, the Courts will decide employment status based on the written contractual terms and on the factual matrix that existed when the contract was made. Generally, the Courts will not refer to evidence other than the written contract (for example, they will not refer what the parties did in practice).

Exceptions to this are where:

  • the contract is not comprehensive (other terms and conditions then have to be established from other evidence),
  • one or more of the written terms have been varied by agreement,
  • one or more of the written terms are a sham.

In contrast, where there is no comprehensive written contract, the Courts regard employment status as a question of fact or a mixed question of fact and law. The Courts will not disturb a Tribunal decision based on fact unless they think it is perverse.

Source: HM Revenue & Customs | 28-08-2019

Back

Post a Comment

Your email address will not be published. Required fields are marked *

*

  • ABOUT US

    the accountancy practice kent logo

    The Accountancy Practice is a Kent based firm specialising in small and medium sized businesses. We provide a friendly, professional service and regard our smallest client as important as our largest.
  • Latest News

    20-02-2020
    Employer toolkit for EU Settlement Scheme published

    Following Brexit, ... read more

    20-02-2020
    Change to the off-payroll working rules

    As part of a review ... read more

    19-02-2020
    Could you claim the marriage allowance?

    If you are entitled ... read more

    More news

  • CONTACT US

    The Accountancy Practice
    10 Churchill Square
    Kings Hill
    West Malling
    Kent ME 19 4YU

    01732 897929

    Fax: 01732 897939
    info@theaccountancypracticeltd.co.uk


    Facebook
    Twitter
    Linkedin
  • Why choose us

    By working more closely with you than traditional accountants, The Accountancy Practice is able to gain a deeper understanding of your individual business needs. We are then on hand to support you with day to day issues and provide ongoing financial and taxation expertise. You can think of us as your virtual Financial Director.