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PayStream's opinion – Introducing ‘controlling persons’ the latest announcement from the Treasury

Paystream News

Alison Roberts

Friday 31st Aug, 2012

Over the last couple of months we have been keeping you up to date with the introduction of the IR35 Business Entity tests, providing help and advice on what these tests are and why HMRC have introduced them.

Following the introduction of the tests and the Treasury's latest announcement regarding 'controlling persons', Government departments have been told that they can't deal with long term contractors in senior roles (£220 per day or more) until they have confirmed that the contractor is either:

  • being paid on a PAYE basis (e.g agency payroll, umbrella or 100% salary through his limited company). Evidence such as payslips will be required; or
  • outside the scope of IR35. Each individual government department is required to carry out its own test on these individuals using HMRC's online Employment Status Indicator (ESI) tool which unfortunately isn't very contractor friendly, you can view the tool here. If this shows the contractor is self-employed there is no issue but if not, the contractor will have to provide his own evidence that he is outside IR35 in order to continue working on the contract and one way to do this is to procure a written opinion on the contractor's IR35 status.

If you're a limited company contractor working in a senior public sector role our advice is to contact PayStream for an IR35 review, which as a PayStream customer is completed free of charge, by contacting the Compliance Team on 0161 929 6000 or email

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