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HMRC enquiries on Employment Status & IR35

17 April 13 | By: Jas Jhooty


Welcome to the latest newsletter from emTax. This week we have been asked to focus on the ever popular lines of enquiry by HMRC on Employment Status & IR35.

emTax is an exciting new consultancy service that offers the very best employment tax advice at affordable prices. We consist of a network of ex-”Big 4” Senior Employment Taxes Managers and can offer exactly the same advice as the Big 4 accountancy firms but at a fraction of their costs.

We hope you find this newsletter informative. Please feel free to forward it to anyone who you think may be interested in its contents.

If you are interested in this offer or want to find out more about any of our other services please visit our website or telephone us on 0345 548 3680 or email us at enquiries@emtax.co.uk

Employment Status/IR35 issues

With recent high-profile cases such as BBC journalists being paid via their own Personal Service Company (PSC), employment status enquiries have never been so popular with HMRC who often insist that self employed subcontractors should be classified as employees. However the HMRC view may not reflect the full picture, with employment status being a very ambiguous and complex area. The repercussions for the employer can be enormous with huge PAYE and Class 1 NIC liabilities arising if HMRC’s views remain unchallenged. If you are subjected to an employment status enquiry our advice is to ask one of our expert consultants to represent you as soon as possible.

For contractors that are engaged via their own PSC there is a temptation to think that any ‘IR35’ obligations simply arise on the PSC rather than the hiring business. Whilst this is true in most cases, a contract that is within the scope of IR35 may result in dissatisfied contractors as well as greater risk of the contractor accruing rights under general employment law, Working Time Regulations, or Agency Worker Regulations.

As always prevention is always better than cure so it would be prudent to contact us to review your current arrangements when it comes to engaging self employed subcontractors before HMRC start any enquiries. We can advise you on engagement practices and leave you with tailored contracts for services that should leave you ‘audit-proof’.

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We at emTax value your comments and views. Please let us know If there is any aspect of employment taxation that you wish to be covered in future newsletters.


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