Many contractors are wondering how they can mount an IR35 challenge post-April 2021. Is there any way to successfully appeal an inaccurate or even non compliant IR35 determination?
IR35 Rules
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.
Off-Payroll Rules
The 'off-payroll' addition to the existing IR35 rules was introduced across the public sector in April 2017 and the private sector in April 2021.
The 'Off Payroll' rules mean that clients (not contractors) are responsible for determining the employment status of contractors. Before this, workers themselves were responsible for this determination.
Get started with these IR35 guides
- Start with our overview of IR35 for a concise guide to the legislation.
- Read our Off-Payroll working FAQs for contractors.
- Try our IR35 tax calculator to find out the financial cost if you are caught.
- Download an IR35 contract template from Qdos
- Why you should consider taking out IR35 insurance.
PSC contractors caught by Off-Payroll – how do payments work?
If you work on an ‘inside IR35’ contract post-April 2021, then your fee-payer (agency or client) will be responsible for deducting taxes from your contract income, but exactly how is this income taxed before your limited company receives funds?
Off-Payroll – can HMRC investigate past contracts retrospectively?
With the private sector off-payroll changes set to go ahead in April 2020, some ‘outside IR35’ contractors may be forced to work ‘inside IR35’ if their clients are reluctant to take on the potential risks of making incorrect employment status decisions – at least for the time being.
IR35 off-payroll – what constitutes ‘reasonable care’?
When end-clients determine the IR35 status of contractors in the private sector from April 2021 onwards, they are tasked with taking ‘reasonable care’ when making employment status decisions.
Calculate how IR35 affects net take home pay
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.
CEST – HMRC’s IR35 status tool – what it does, and why it is flawed
Nothing makes critics of the IR35 ‘off-payroll’ legislation (and there are many) more irate than the mention of CEST – the official online tool which is meant to help determine employment status.