Skip to main content

Is IR35 on your mind?

Paystream News

Alison Roberts

Monday 30th Jul, 2012

In essence, IR35 simply says that if a worker is a disguised employee of the client then he should be subjected to the same tax and national insurance deductions as other regular employees. IR35 does not therefore affect those paying employed levels of tax (for example, umbrella workers) but those running their own personal service companies (PSC) and declaring dividends from company profit.

If IR35 does apply to you, then we advise you to take IR35 advice on a regular basis. Existing MyPSC and PSC Online clients have the option of using PayStream's IR35 review service which comprises a review of the contract for service(s) you have in place with the agency/client and agency to client and a review of your working practices. We can also advise you on your risk profile with HMRC via the new Business Entity test.

On the basis of current information, HMRC may ask you to complete the Business Entity test as part of its risk assessment. Generally speaking HMRC are more likely to investigate you if you fall in the high risk or medium risk category. You can find out more about the Business Entity tests here.

Our advice is to keep IR35 in mind and remember to take IR35 advice on or around the beginning of an assignment and at intervals during the assignment. HMRC will not open an IR35 review until after the tax year has ended and if you have not considered your IR35 status at the time of the assignment, you may find it more difficult to remember or gather evidence to support your status.

If you would like IR35 advice, please contact the Compliance Team on 0161 929 6000 or email and we will send you full details on our IR35 service.
Back to the Top