Example IR35 Status Determination

We believe this engagement falls Outside IR35 and the contractor is therefore Self- Employed for tax purposes, due to the following reasons on the right:

ABOUT THE CONTRACT

  • The contractor is not acting as an office holder of the end client Personal Service
  • The contractor is not named specifically on the contract
  • The contractor is able to sub-contract part or all of the work to a third party
  • The contractor’s business is able to send a suitable substitute in place of the contractor
  • The contractor’s business would be responsible for sourcing and paying any substitute

END CLIENT CONTROL

  • The contractor is not acting as an office holder of the end client Personal Service
  • The contractor is not named specifically on the contract
  • The contractor is able to sub-contract part or all of the work to a third party
  • The contractor’s business is able to send a suitable substitute in place of the contractor
  • The contractor’s business would be responsible for sourcing and paying any substitute

INTEGRATION

  • The contractor is presented as a supplier to the client’s customers and not as part of its business.
  • The contractor is completely separate from the client’s internal structure

PART AND PARCEL & BUSINESS ON OWN ACCOUNT

  • The contractor is responsible for correcting faulty work at their own cost
  • The contractor’s company is required to hold insurances such as professional indemnity
  • The contractor is not restricted from working with other clients during this engagement
  • The contractor carries out work for other clients at the same time as this engagement
  • The contractor doesn’t manage any employees of the end client
  • The contractor actively promotes their business through various marketing channels
  • The contractor incurs expenses which are not reimbursed by the client

MUTUALITY OF OBLIGATION (MOO)

  • The contractor will not be paid when they are unable to work due to sickness
  • The contract for this engagement is for a specific project only
  • The contract terminates automatically if the project they are working on comes to an
  • end The client is not obligated to pay the contractor if there is no work to do
  • The contractor is not required to carry out work outside of that named in the project

Written by Vegan Accountants

The expert team at Vegan Accountants take away the hassle and pressure of your accounts and tax compliance. Our wide-ranging services give us the flexibility to deliver tailored support for your business.

February 14, 2022

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