IR35 is also known as ‘intermediaries legislation’. You may need to follow IR35 if you work for a client through an intermediary.
The intermediary can be:
• your own limited company
• a service or personal service company
• a partnership
If IR35 applies then the intermediary has to operate PAYE and National Insurance contributions on any salary or wages it pays to you during the tax year.
The intermediary is always responsible for complying with IR35 legislation when it applies. If you’re a director of your limited company or a member of your partnership, you must make sure all relevant legislation is followed, and take responsibility for deciding if it applies for each of your engagements or not.
There can be significant consequences if you, your intermediary, or client ignore IR35 legislation. Interest and penalties can be charged on any extra tax and National Insurance contributions that are owed. Penalties can be more severe if it can be proved that IR35 rules or legislation have been deliberately ignored.
At ASVSH we have specialist advisers who can guide you and let you know if IR35 applies to you. In cases where it is applicable to you, we can provide advice and guidance and operate IR35 for your company or partnership.