IR35 is the name of the press release issued by HM Revenue and Customs in May 1999 setting out new rules in relation to the taxation of personal service companies. The rules which were first implemented seek to tax individuals operating through the medium of a limited company as though those individuals were employees of their own companies client.
The legislation was designed to correct a perceived “mischief” identified by HM Revenue & Customs whereby employees of much larger companies were able to avoid paying tax and national insurance on their earnings by providing their services through the medium of their own small personal service company. Unfortunately the rules’ applicability is not altogether straightforward revolving as it does around the vexed issue of employment status. We can provide you with a clear analysis of your own and the company’s position in relation to these rules. It is not the case that “IR35 proof” contracts can be devised without regard to the real economic and legal relationships between the parties. Whilst we do review contracts and contractual terms, our analysis goes deeper than this, providing you with greater confidence that your business is fully tax compliant.