Off payroll legislation IR35
Whether you are new to contracting or a seasoned expert I’m sure IR35 is, at the very least, on your radar. With stricter guides outlined by HMRC, back in April 2017, for our public-sector contractors it is certainly on ours.
If you are working via an umbrella company then you are already sorted, if not and your contract is running through a personal service companies (PSC), then these regulations are for you.
Ultimately it comes down to the end client and if they believe these tax rules apply to your assignment. If they do, you are deemed “inside IR35” and you will need to pay tax as if you were an employee, to HMRC.
The main factors used to determine the IR35 status of a contract are:
- Control: what degree of control does the client have over what, how, when and where you complete the work
- Substitution: is personal service by the yourself required, or can you provide a substitute in your place?
- Mutuality of obligation: mutuality of obligation is a concept where the employer is obliged to offer work, & the worker is obligated to accept it.
How do I know what the IR35 status is?
All associates should consider their IR35 requirements when accepting a contract and the impact this could have on your tax obligations. If you have any queries regarding your contract’s IR35 status, please contact your account manager or the business assurance team; they will be able to offer you some guidance through this. Business.assuranceteam@dev2.methods.co.uk
It is Methods responsibility to ensure that all information is obtained from the client as soon as possible so there can no ambiguity as to the status of the role.
What if my contract falls “inside IR35”?
For any contracts that fall inside IR35 the associate will be required to supply their services via an umbrella company from our preferred suppliers list (PSL) to ensure the correct amount of tax is being paid. Methods is not able to provide PAYE services for associates. Please contact your account manager for more information on our umbrella PSL.
Any questions?
Please contact us on business.assuranceteam@methods.co.uk or call us on 020 3795 5680