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What is IR35?

Why is IR35 so important for limited company contractors?

IR35 is a piece of legislation that applies to limited company contractors. If you are working for a client through your own limited company and in reality, you work in the same way as an employee of the client, IR35 says that you need to pay employed levels of tax and national insurance (NI). This is known as working ‘inside’ the scope of IR35. 

Many limited company contractors legitimately work ‘outside’ the scope of IR35. This means they are genuinely in business on their own account, providing services to a client on a contract for services. In this scenario, they enjoy greater tax efficiency and often pay themselves a mix of salary and dividends.  our video helps to explain in more detail what IR35 is.

Why IR35 is so important