From 6 April 2021 there will be changes to how IR35 works in the private sector. These changes were introduced for the public sector back in 2017 so there is already experience of what is involved and some case law where appeals have been made.
If you operate through your own company (and in rare cases through a partnership) then you may be affected. If one of your customers provides you with or has provided you with something titled “Status Determination Statement” (or something similar as there is no fixed format) in which the IR35 tax legislation is referred to and you are not fully aware of the implications of this then you need to contact us without delay so that we can explain matters, review the determination and if applicable ensure that an appeal is launched. These determinations can have a significant affect on your tax and national insurance liabilities and your cashflow!
If you are a large operator and meet two or three of the following conditions:
Then you need to consider IR35 from the other side; if you engage with any suppliers who trade through their own service company then you need to determine their status and issue them with a Status Determination Statement, this is a legal requirement. If they are within IR35 then for any work undertaken after 5 April 2021 you will need to apply PAYE and deduct tax and national insurance. In addition you as the “employer” will also suffer class 1 employer’s contributions at 13.8%.
If you think that this new legislation will affect you then please contact us.
At Glover Stanbury, all of our services are designed to add significant value to your business and personal wealth. read more