CLIENT CASE STUDY
Industrial Power Solutions Ltd was founded in 2003 and its core business is providing installations and project programme delivery to the HV Energy Cable Systems and LV Mains Cabling sector.
In 2012 IPS was inspected by the HMRC and was deemed to be 'disguising the employment status' of its core contract workforce of 25 + electrical trades by engaging with them on a self-employed basis rather than PAYE.
The outcome was an original fine of £250,000, roughly £10k per head which after considerations and negotiations with the HMRC was reduced to £90,000.
For obvious reasons the fall out of the fine had a considerable financial and operational impact on the business and a solution had to be sourced to enable IPS to continue trading.
Shortly after in late 2012 IPS entered into discussions with Genius with regards to finding a payroll and contract trades staffing solution.
Due to the labour costs already committed to it was imperative that the CIS trades that were engaged by IPS could be transferred to a solution that could continue to legally engage their future contractors on a Self-Employed basis where possible.
Furthermore, the solution had to be able to add skilled M&E Trades to IPS to further support various projects throughout the fiscal year.
David McCarthy - Director of IPS said...
"What can I say, when we were inspected by the HMRC we had a massive issue to deal with that could of threatened IPS continuing to trade.
Although we were aware of the waves that the Revenue were making about inspecting companies for IR25 we never in a million years though we would be one that would be targeted.
The key reason for engaging the services of Genius Money Limited was that it took this issue away from us with immediate effect and offered a legal and practical solution to our business needs.
They took away all the employment liability and associated headaches that we had with engaging a self-employed workforce, and in addition assisted us with attractive payment terms and payroll support to enable us to reinvest both the time and money in growing our business.
They were also able to provide us with a steady stream of quality electrical trades via V3 as and when we needed them to enable us to cope with the various client works we had comping up.
Genius, a solution that came at the right time for IPS and one that we truly could not have continued to trade without."
IPS engaged Genius Money on a Contract for Services basis and the compliance, verification, tax deductions and payment process were no longer a direct responsibility of IPS. This naturally became the responsibility of Genius Money.