What is IR35, and what is the ‘off payroll working rule’?
IR35 is also sometimes known as the ‘off payroll working rules’ and the ‘intermediaries legislation’. The name IR35 is generally used to mean the anti-tax avoidance rules designed to combat ‘disguised employment’ where an individual, who would otherwise be an employee if engaged directly by a client, provides services to a client through the individual’s own intermediary company (sometimes known as a Personal Service Company or PSC).
If the individual is in ‘deemed employment’ then rules apply so that PAYE and NICs must apply to the fees.
What’s changed and what’s not changed for private sector businesses on 6 April 2021?
Use this simple flow chart to help you determine what you need to do next:
* HMRC has confirmed that a PSC will fall within IR35 if either:
** A company is small if it satisfies two or more of the following conditions:
(Companies which are not part of a group will be treated as ‘small’ in their first financial year, and until they cease to be so.)
The position can be complex so speak to our experts to make sure you have everything in order and all the documents you need in place. Contact us at https://lochassociates.co.uk/
Sally joined Loch Associates Group in 2015 and has over 20 years' experience working in HR across both the public and private sector, operating at strategic and front-line levels. She is CIPD…
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