IR35 guides and help: Do the rules apply to you?
What is IR35?
IR35 is the short name used for the ‘intermediaries legislation’, which is a set of tax rules that apply to you if you work for a client through an intermediary – which can be a limited company or “personal service company” which is how many contractors operate.
If you are caught within the legislation then you can expect to pay about 25% more in tax every year, so you want to try and ensure that it does not apply to you!
Despite having been in force since 1999, it is heavily criticised by tax experts and the business community as being poorly conceived, badly implemented by HMRC and causing unnecessary costs and hardships for genuine small businesses.
IR35 facts:
- Introduced in April 2000. Reformed in April 2017.
- If you are caught, you will pay circa 25% more in tax
- Based on complex employment case law
- Should not affect professional contractors
- Beware: Take professional advice to avoid
If you are a genuine professional contractor, freelancer, interim or consultant who is in business on your own account, you should have nothing to fear from IR35. This is so long as you take the time to understand how the legislation works and apply best practice to ensure it does not apply to you, and have a defence prepared if investigated by HMRC.
You can start by using our IR35 calculator below to determine how much extra tax you would have to pay if caught, and also use our free online IR35 status test to determine your status. Then our comprehensive guides will explain how you can ensure you never get caught by it.
IR35 Status Check – Find out your status?
Contact us now and we will provide an assessment, developed by experts, covering all potential risk areas and help evaluate your IR35 status.
