All Posts By

Brad Bamfield

VAT Reverse Charge – update no 1

Monday 16th September 2019  Brad Bamfield joined an HMRC webinar on VAT Reverse Charge which was very informative but only really skimmed the surface.

Picture of Brad BamfieldIt does seem however that it only applies to Contractors and Subcontractors who are also paid through CIS and not “End Users” or material only suppliers.

Brad is looking farther into this, but it also seems professional advisers are excluded and should charge VAT in the usual way.

However, Brad says “I asked specifically about Cost Managers and PMs but did not get a clear answer, so more work needed”.

We are attending another seminar early in October so will add an update after that.

PDSI and subsidiaries awarded Cyber Essentials for 2nd year

PDSI and its subsidiary companies – Initiate Consulting, Profile Construction Consultants and Queensborough Project Management have been awarded Cyber Essentials certification for year ending July 2020.

Terry Chapman Group CEO says “Cyber Essentials is just that essential in this day and age and it forms a key part of our defense of the data we hold.”

PDSI Group adopted Cyber Essentials as “best practice” in 2018 when we found our old infrastructure was potentially unsafe. The review process of Cyber Essentials allowed us to challenge every part of our IT and Online infrastructure and to provide our management board with confidence we are complying with GDPR requirements.

It is no coincidence that the Information Commissioners Office with the introduction of GDPR made it abundantly clear that if businesses did not review and address short comings then they could be fined large sums and the principals possibly jailed.

Brad Bamfield said “we involved everyone in the business and our 4 out sourced IT and VoIP telecoms companies in our review and found that new vulnerabilities arise all the time. It is easy to become complacent and assume you are all OK until you find your web site has been breached. Simple steps outlined in Cyber Essential reviews can show you where you need to improve.”

Our certificate number is 9382370780624912 and is dated 12 July 2019

More on Cyber Essentials here

More on our Privacy Policy here

VAT Reverse Charge – does it affect us?

It was announced on Friday 6 September 2019 that the implementation of the domestic reverse charge, which makes payment of the tax responsibility of the customer rather than the supplier, will now come into effect on 1 October 2020.

A statement from HMRC said that the change would be delayed because industry representatives had raised concerns that the sector was not ready for it.

A group of construction industry bodies wrote to the government warning of the problems it would cause companies last month, asking for a delay until April.

The change is part of anti-fraud rules aimed at targeting VAT-related fraud in supply chains within construction.

The statement from HMRC added that the body “remains committed to the introduction of the reverse charge and has already increased compliance resource”.

A UK customer who acquires supplies for construction services must account for VAT due on these materials on their VAT return rather than the supplier. In other words, the domestic reverse charge prevents fraudsters from stealing VAT owed to HMRC.

HMRC also underscores the need for businesses to adapt their accounting systems for dealing with VAT. Many of these will experience a negative impact on cash flow whilst no longer receiving VAT payments from customers for services where charges apply.

Brad Bamfield, our Finance and Management Director, is leading the PDSI Group Reverse VAT initiative and is attending various courses to ensure we are ready.

Brad said “I have read the HMRC guidance and its wording is not the clearest in the world. The definition of an End User is new and is key to the application of VAT through the supply chain.

My understanding is that domestic reverse charge will only affect supplies at the standard or reduced rates where payments are required to be reported through the CIS and that specified services are excluded, including professional services of architects, surveyors and certain consultants.”

Brad will provide more information here as he works through what is required and what we and our supply chain need to know and do.

However, we already know when the new rules do take effect, only principal contractors at the top of the supply chain will receive VAT payments, which they will collect from the client before paying it to HMRC.

More importantly monthly cashflow profiles for subcontractors will change, and all contractors will have to take on more administration, understanding who should and shouldn’t be charged VAT.

Brad Bamfield

Executive Assistant to MD and social media marketing manager

PDSI Construction Consultants is looking for a bright articulate graduate with ambition and confidence to join an established team at our London office. PDSI group is a privately owned construction consultancy comprising 3 specialist trading businesses with offices in London, Kent and Majorca visit; www.pdsiconsult.com

The role is new and will suit someone looking for a challenge and wishing to be part of an evolving and changing role offering opportunity and variety. The successful candidate will be based at our London office with a dual role

(i) reporting to the MD responsible for our transport and infrastructure business as personal assistant covering a variety of assignments forming part of a learning and personal growth plan and

(ii) reporting to the Group Business Administration Director covering marketing support, social media and business finance.

This is a fantastic opportunity for a candidate with ambition, technical know how in social media, a real self-starter with an appetite to help shape the role under the guidance and direction of two very experienced demanding leaders.

The role would likely suit a Graduate with Business Studies degree (although not essential). Knowledge in creating social media content, email design and broadcast, updating website content and reporting on key metrics using various analytical tools would be helpful together with good positive communication skills, pre-active and a willingness to learn.

If you are hardworking and confident with good communication skills, ambition to be part of a fast growing interesting business and believe you have what is takes – get in touch outlining why you feel you are the right person for the role.

The opening is an immediate start.

Please send us your CV and a letter telling us why you would be suitable to katarina.jocic@pdsiconsult.com

We are an Equal Opportunities Employer and comply with the Equality Act 2010.

The role of a Development Manager

To demonstrate the role of a Development Manger we must first think about what a “developer” is and what they do.

Real estate or property development, is a multifaceted business process, encompassing activities that range from the renovation and re-lease of existing buildings to the purchase of raw land and the sale of developed land or parcels to others from speculative developments that will be sold at the end of construction to extensions to premises for business wishing to expand.

Development Developers are the people and companies who coordinate all of these activities, converting ideas from paper to real property. Real estate development is different from construction, although many developers also manage the construction process.

Developers buy land, finance property deals, build or have builders build projects, create, imagine, control and orchestrate the process of development from the beginning to end including obtaining the necessary planning approval and financing, build the structures, and rent out, manage, and ultimately sell it.

Developers work with many different counterparts along each step of this process, including architects, town planners, engineers, surveyors, building inspectors, banks, contractors, leasing agents and more.

For many clients, stepping outside their core business into the world of property development and management can be challenging, but this where an experienced Development Manger comes in, they offer a full development management service,

  • assisting clients with the initial startup processes and
  • analysis of the financial viability of a scheme
  • formulating robust and appropriate development strategies and
  • manage the development process from the appointment of a professional team through to t
  • he planning and successful delivery of projects,

Ensuring you start right will mean you will end right as well. Most projects fail not in construction (although it looks that way) but in the selection of the consultants, contractor and design

PDSI are increasingly called upon to apply our skills and experience earlier in the project cycle, working with developers or property owners who have the skills to create the opportunity but need support to make it happen.

Organising for a development

A development team can be put together in one of several ways.

  • At one extreme, a large company might include many services, from architecture to engineering.
  • At the other end of the spectrum, a development company might consist of one principal and a few staff who hire or contract with other companies and professionals for each service as needed.

Assembling a team of professionals to address the environmental, economic, physical and political issues inherent in a complex development project is critical.

A developer’s success depends on the ability to coordinate the completion of a series of interrelated activities efficiently and at the appropriate time.

The development process requires skills of many professionals:

  • architects,
  • landscape architects,
  • civil engineers and
  • site planners to address project design;
  • market consultants to determine demand and profitability
  • Quantity Surveyors to define project’s economics;
  • lawyers to handle agreements and government approvals;
  • environmental consultants and soils engineers to analyse a site’s physical limitations and environmental impacts;
  • surveyors and title companies to provide legal descriptions of a property; and
  • lenders to provide financing.
  • The general contractor of the project hires subcontractors to put the architectural plans into action.
  • Sales agent for marketing and sales or
  • Logistics of moving into your new building

And the person who manages all this is the Development Manger as you can see its the key role.

It may well be that as a business you have an experienced person or people to manage all these facets of the development but if you are not a regular developer you need the support of a consultant.

Now beware many consultants tell you they are Development Mangers but in reality they are Project Managers and there are subtle differences.

Project Managers are totally focused on delivery, “give me the land, the drawings and I will give you the building”

Development Mangers make decisions about viability, design, cost and quality – they produce the stuff the Project Manager needs to deliver the project.

They are really different people with totally different skills.

Development Managers are creative and problem solvers, whereas Project Managers are process based deliverers

So a good Development Manger usually makes a poor Project Manager and vice a versa as they have different mind sets.

PDSI offers Development Management to our clients and provide support and management from Day 1 when you just have an idea to when we hand you the keys to you completed project.

Call Terry Chapman now for more information about how we can help your deliver a successful project.

PDSI Joins Export Champion Community

PDSI group companies have wide experience of working overseas and exporting our property and construction services. Profile Construction Consultants has contracts in 3 European countries and an office in Spain and Queensborough Project Management has experience of working in northern Europe and the Middle East.

We are pleased to be an Export Champion and Advocate helping other businesses to begin exporting their services.

Terry Chapman, Group CEO, said “we are very proud to be part of the Export Community and look forward to working with other business to the benefit of all.”

The Department for International Trade’s (DIT) Exporting is GREAT campaign aims to spark a movement around the UK of companies selling their products and services overseas.

At the heart of the campaign is the Export Champion Community,  consisting of over 1,000 ‘Export Advocates’ and ‘Export Champions’; everyday businesses of all shapes and sizes, run by extraordinary people, (theses are DIT words not ours) from around the UK that are proudly selling overseas.

  • become part of Exporting is GREAT, the Government’s most ambitious and high-profile export-focused campaign ever
  • join a UK-wide community of exporters who share advice, ask/answer questions and signpost to where support is available
  • get access to a suite of digital campaign assets to use in your communication and marketing activity

Any UK-registered company that has exported at least once you can join the network of Export Advocates, which comprises firms from across England, Northern Ireland, Scotland and Wales in a wide range of sectors.

More here https://www.great.gov.uk/community/

What is IR35 and does it apply to me?

What is IR35 and does it apply to me?

IR35 was introduced in 2000 and designed to reduce tax avoidance by contractors who HMRC believe to be “disguised employees”- in other words people who are working in similar ways to full-time employees but invoice their services via limited company in order to pay less tax.

IR35 Rules:
Under IR35 rules the contractors would have to show that they were not employed by the company and have no employment relationship with the company. Contractors can find out whether they fall ‘inside’ or ‘outside’ IR35 they would have to keep in mind the following four factors:

1. Control
Self-employed contractors have their own control of when and how they work, if the contractors contract seems to be rigid and sets the working patterns and also applies excessive control over the contractors work and how it is completed these terms would a make the contract look like an employment contract and not a contractors contract. This makes it very likely that you would fall within IR35 or can make it hard to prove otherwise.
2. Contract
It is in the best interest of the contractor to create their own contract to the hiring organisation to prevent any misunderstanding within the contract. This allows the contractor to set their own terms and not have the term set for them by the hiring organisation.

3. Mutuality of Obligation
As a self-employed contractor you would have to show that you work on a project to project basis where there would be an contract end date in the contract and would have no obligation to work past the contract end date stated the contract with the client.

4. Substitution
As a contractor you can supply a substitution to the organisation, but where in the contract it states there is no right to substitute this could potentially make the contract fall within IR35.

IR35 in the public Sector

Initially IR35 employment status was always declared by the contractor and not the hiring organisation, but in 2017 these rules changed dramatically for the public sector and for the contractors but also for the hiring companies. The liability to prove the self-employment moved from the contractors to the hiring organisation which then made it problematic for either parties because if the contractor was to had been found to be inside IR35 they would have to pay tax and NI as employees and not receive employee benefits of the organisation. These changes also then impacted the hiring organisation as it was now seen as a risk because they could be fined if they had incorrectly identified the contractor as outside IR35, this lead to many of the public sectors to cease using self-employed contractors.

IR35 in the private sector

Currently the private sector does not have to worry about IR35. But now the Government have argued that contractors paying less tax than employees should be considered as unfair and as a result of that the Government are in consultation about further changes to the IR35 and some of those consultations have resulted in IR35 being reformed and extended to the private sector and their contractors in early 2020.

IR35 Check list: (Test your employment status)

Payments
In order for you to stay outside the IR35 you would have to be paid on a project-to-project basis and would have an end date to their project and usually the work ends when that period of time has reached.

Financial Risk
Self-employed contractors are much more likely to experience a higher level of financial risk compared to employees of an organisation. If you have guaranteed weekly or monthly pay in your specific contract within the organisation, this will look like an employee’s contract rather than a contractor fees being paid for the service they are providing. Also if you are required to send invoices when billing the organisation it must detail the services they are being billed for the period of time that you are requesting payment for. If it is guaranteed, fixed regular payments that look like a salary that could make the contract fail IR35 tests.

Equipment
As a contractor you would have to state within your contract that the equipment that would be used within the project that the client has assigned to you would be your equipment – if the contract does not state what the equipment is and who would be providing it HMRC could view this as if the client is providing you within equipment and would then put you within the IR35 as it would complicate figuring the status of the contractors employment status.

Exclusivity
As a self-employed contractor, a perk of this would be that as a contractor you are able to work with more than one client at once, however with this being said if a contractor seems to be working with one client for a prolonged duration it could be seen by HMRC that this is actually an employee to employee relationship and not client to contractor relationship.
Running Business
In order to prove your status, you would actually need to have a running business – this would include having a running website, office space or registered address for the business would all reinforce that you are operating as a self-employed contractor for your own business and not an individual who is offering their service as an employee.

How to prepare?

Firstly, you can check your status on the HMRC website using the link below: https://www.tax.service.gov.uk/check-employment-status-for-tax/reason-for-using-tool

Seek professional advice
After checking your status on HMRC and you are still unsure or would still like some help, seek advice before you go ahead and make any changes to your business as it stands – this will allow you to understand that changes and make sure that all the changes you make within your business are compliant with IR35 law. Seek advice from a professional who specialises in IR35 Laws and preferably within the contracting sector also.
Initiate use several specialist advisors and companies and we are happy to share them with our contractors. If you are interested in doing so, please contact the office.