IR35 HUB

Introduction:

A Contractor working through a Limited Company needs to know about IR35 – which has been in existence since 2000.  IR35 refers to a hypothetical contract between the Contractor and the end-client, which affects how much tax is payable.  If it is decided the contract is more like employment than self-employment, then the Contractor is caught by or inside IR35. The Contract (sales) income is then treated like salary for tax purposes – and PAYE and National Insurance is payable to HMRC.  If the Contractor is not caught by or outside IR35, they can pay themselves just as any Company would, ie. taking a small salary and paying dividends, splitting dividends with a spouse and getting tax relief on expenses. All of these reduce the tax paid.

Huge changes are now imminent for Contractors – especially those working in the Private Sector.

This page includes a series of three videos covering IR35 in the Private Sector, including advice on how to protect yourself.

A brief history of IR35

In 1999 IR35 was brought in as a new law to attack Contractors cheating the system and have them pay the right taxes and NI. At the time no one understood how to deal with it but over time…

 

The new laws from April 2020

From April 2020 end clients must decide on the IR35 status of Contractors working for them. They will be asked to use a tool supplied by HMRC to assess their IR35 status.

 

 

How Contractors can protect themselves

Some ideas on how to deal with your end client and agency and how to find out more about your options.

 

Get in touch today for a free consultation.

We are very happy to meet you to discuss your business or even your idea for a business. We will advise you on the most tax efficient structure if you are setting up and we can review your business if you are already trading.