Introduction

 

IR35 was introduced on 06 April 2000, in response to a growing trend of people leaving their jobs and registering as self-employed, before being hired by the same company they just left on a long-term basis – often doing exactly same job they did prior to registering themselves as self-employed. By registering as a Limited Company, they were able to reduce their Income Tax and National Insurance bills.

However, because these individuals were in effect being directly employed by the companies they were working for, the government‟s view was that they were not entitled to the tax advantages that they were receiving, and the IR35 regulations were introduced.

If the Inland Revenue decides they will calculate what is known as a 'deemed payment', treating all income as salary and asking for Income Tax and National Insurance contributions on income originally paid out as dividends. IR35 works by taxing the profits of the Limited Company as income, and by requiring the company to pay National Insurance contributions.

 

Next Step:

 

Please contact us if you need further advice, have any questions about our services, would like a free consultation.

Speak to us today. Call: 0333 5775 332 or Email: info@account-direct.com

 

we are offering
£150 each time someone
you refer to us starts using
our service.
enjoy tax rebates
starting from £2500.
Get 100% Free
Initial consultation
Limited company
sole trader
start ups and small businesses
Contractors
Free guides
Calculators