QAccounting’s private sector IR35 survival kit has been developed by tax and IR35 specialists and ex-HMRC inspectors, to arm private sector contractors with useful information to help them operate compliantly and safeguard their IR35 status.
IR35 IN THE PRIVATE SECTOR
- HMRC introduced the ‘Intermediaries Legislation’ that became known as IR35, in 2000 to combat ‘disguised employment’. This relates to an individual who would be treated as an employee were it not for the fact they provide their services via their own personal service company.
- Contractors working through their own limited company do not need to pay National Insurance Contributions (NICs) on income taken as dividends, which means the Treasury receives less tax. In short, IR35 exists to ensure that those working in this manner pay the tax they should.
- Being ‘caught’ by IR35 can have serious financial consequences. HMRC can investigate contracts up to six years old, and if you’re found ‘inside IR35’, you will need to repay missing and National Insurance Contributions, which can amount to hundreds of thousands of pounds.
- In 2017, the Government introduced reform in the public sector. This saw contractors’ clients become responsible for administering IR35, with the fee-paying party now carrying the liability.
- From 2020, similar rules will be extended to the private sector, with medium and large companies becoming responsible for setting status. Like the public sector, the fee-paying party will become liable.
PRIVATE SECTOR IR35
IR35 Survival Kit (Private Sector)
IR35 SURVIVAL KIT
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