If your contract work is caught by IR35, your tax bill will rise considerably. Here, we use our IR35 calculator to work out the financial impact on contractors earning between £250 and £1000 per day.
IR35
The Intermediaries Legislation was introduced in 2000 to tackle 'disguised employment', where an individual uses a limited company to carry out professional services, but works in a manner more like an 'employee'. Your take home pay will be significantly lower if your contracts fall within its scope.
Private sector IR35 changes from April 2020
So-called 'off payroll' changes to the IR35 rules were made to public sector organisations from April 2017, and will also hit private sector businesses from April 2020, following an announcement in Budget 2018. These new rules mean that clients (not contractors themselves) will be responsible for determining the employment status of contractors.
A consultation on how the private sector changes will be rolled out was published on 5th March 2019 - read our summary here.
- April 2020 Private sector IR35 reform - what happens now?
- What clients can do to prepare in advance of April 2020.
- What contractors can do to mitigate against the IR35 changes
Get started with our IR35 guides
- Start off with our overview of IR35 for a concise guide to the legislation.
- Expert FAQ - Are you 'inside' or 'outside' IR35?
- Try our IR35 tax calculator to find out the financial cost if you are caught.
- Why you should consider taking out IR35 insurance cover.
IR35 off-payroll – what constitutes ‘reasonable care’?
When end-clients determine the IR35 status of contractors in the private sector from April 2020 onwards, they are tasked with taking ‘reasonable care’ when making employment status decisions.
Is it worth keeping your limited company if caught by the IR35 off-payroll rules?
If you are caught by the off-payroll IR35 rules, you may decide that there is no point keeping your limited company active. However, this isn’t necessarily the case, as a leading accountant explains.
Expert FAQ – are you ‘inside’ or ‘outside’ IR35?
The basics of IR35 should be understood by everyone in the contracting community at a fundamental level, as the rules have such a profound impact on take-home pay if you are caught. Here, an expert answers our questions on employment status – does your contract fall inside or outside IR35?
Draft private sector IR35 legislation published – industry concerns ignored
The draft legislation which will make the off-payroll private sector IR35 rules law in April 2020 has been published today. With few amendments made, it disregards the concerns expressed by respondents to the recent consultation.
Off-payroll (IR35) – the ‘small company’ exemption – problems lie ahead
When the ‘off-payroll’ IR35 rules are extended to the private sector in April 2020, ‘small companies’ will be excluded as things currently stand. However, the exclusion itself may cause more complications for clients to deal with.
Delay IR35 private sector off-payroll until 2021, experts say
Many major tax and business groups have called for the IR35 off-payroll private sector reforms to be delayed until at least April 2021, as businesses simply won’t be ready to cope with the changes as things stand.
What happens if you’re selected for an IR35 enquiry?
There is a huge amount of information available about IR35 and how to protect yourself. But what happens if you are actually selected for an investigation? How does an IR35 enquiry work and what should you expect if HMRC has lined you up as a target?
The importance of professional IR35 contract reviews
For a relatively small outlay, a professional contract review service will analyse your contracts to ensure that you comply with IR35 – both in terms of your contract wording, but also the ‘working practices’ you undertake at your client site.
IR35 and ‘Confirmation of Arrangements’
A confirmation of arrangements letter from your client can be used to back-up your IR35 position with HMRC should it be challenged, as it confirms how you perform your contract duties in reality.
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