Are you affected by IR35?
IR35 is the United Kingdom tax legislation designed to tax “disguised employment” at a rate similar to employment.
According to HMRC if the only difference is PAYE then you may be ‘deemed’ an employee and under IR35 rules and consequently will be liable to Schedule E taxation and National Insurance (N.I.), following deductions for expenses.
To ignore this law and continue to operate as a limited company even though you may be subject to IR35 rules could be very costly as well as illegal.
To find out if you are affected by IR35 is very straight forward, just get in touch with Tax Smart Group and our legal experts will review your contract as well as discuss your business operations to make sure that you are not affected by IR35.
How to avoid IR35
Although the rules around IR35 are changing the steps to mitigate a contractors exposure and avoid IR35 remain the same. Some simple rules are:
- ‘acting like a business’
- collecting the ‘badges of business’
- making sure your contract is outside IR35
There are many more reasons and our legal experts along side our accountants will help you avoid IR35. The one thing that you should NOT do is IGNORE IR35. The risks are too great.
For any of our clients we offer free support and advice on how to make sure your are legally outside the reach of IR35.