Where does IR35 Apply?

If you go into business with your own Contractor Limited Company you need to know which of your contracts are Inside IR35 and which are Outside IR35. If you take Dividend Income from a contract Inside IR35 you could wind up with a large tax bill at an HMRC Investigation.

Are you a highly skilled expat Contractor? Would you like to maximise your contract income and work towards a visa extension or visa transfer? If so Commonwealth Contractors can help!

To discuss your situation with an experienced advisor call Commonwealth Contractors now on 0800 294 4388 or Submit your Details and we will get right back to you!

Determining IR35 Status

To prove that a contract you’re working on is Outside IR35 you need to satisfy certain self employment tests. To do this you need to analyse;

  • Contract Terms and Conditions, AND
  • Actual day to day Working Arrangements

If you’re not at the stage where it’s possible to do this but would like a general idea you should ask yourself the following questions;

  • Can you pick and choose what hours you work?
  • Can you hire another person to deliver services for you?
  • Do you have the final say on how services are delivered?
  • Are you paid on completion of a particular fixed price project?
  • Can you work from whatever location you like?
  • Do you work for multiple clients at any one time?
  • Do you use your own equipment to undertake the project?
  • Can you make a loss on the contract?
  • Are you required to fix any unsatisfactory work at your own expense?

If you can answer ‘yes’ to the above questions it is likely that you will be considered self employed, and therefore Outside IR35.

If you answer ‘yes’ to the following questions it is likely that you will be considered employed, and therefore ‘Inside IR35’;

  • Are you told what to do by a client representative?
  • Do you have to work yourself rather than subcontract work to a 3rd party?
  • Are you entitled to employee benefits such as a parking space or gym membership?
  • Do you have to work on site to deliver services?
  • Are you paid on an hourly or daily basis?
  • Can you get overtime pay?
  • Are you paid the same time each month? Payment at the same time if you happen to invoice at the same time can be different.
  • Do you work rigidly set hours each week?
  • Are you invited to staff events and functions?

Find out More

To find out more about Commonwealth Contractors call now on 0800 294 4388 or Submit your Details and we will get right back to you!

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