IR35 rules for new Contractors

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IR35 rules for new Contractors

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Күн бұрын

A Contractor working through a Limited Company should learn about IR35 which has been in existence since 2000. IR35 refers to a hypothetical contract between the Contractor and the client and this then affects how much tax is payable. If it is decided that the contract would be more like employment, rather than self-employment, then the Contractor is caught by (fails) IR35. The Contract (sales) income is then treated as salary - and PAYE and National Insurance is deducted. If the Contractor is not caught by IR35 they can pay themselves just as any Company would, ie. taking a small salary and paying Dividends, splitting Dividends with a spouse and getting tax relief on expenses. All of these reduce the tax paid.

Пікірлер: 5

@fsulitskiy 6 ай бұрын

Im contrating for an American company, they are quite small and are not familiar with IR35 rules. How can they report to the government on my status?

@AMSaccountancy 6 ай бұрын

If they are only based in the US and do not have a UK connection (they will have a UK connection if they are resident in the UK or have a permanent establishment in the UK) then the Off Payroll rules do not apply and it will therefore be up to your limited company (you) to decide on your IR35 status. You may of course wish to take advice on this but it means your client in the US does not need to deal with it. I hope that helps.

@fsulitskiy 3 ай бұрын

@@AMSaccountancy perfect! That is very helpful :))

@FiftySixish 8 ай бұрын

I've been told a recruiter that my role will be outside IR35 as the company is small enough for it not to apply, is this in any way accurate?

@AMSaccountancy 8 ай бұрын

If the company hiring you is 'small' by Companies House definition, meaning the off payroll rules do not apply, it means that they do not have to assess the IR35 status, but that the responsibility lies with you. It in no way means you are automatically outside IR35 and recruiters should be careful as to how they advise this.