Create a seperate company for the IR35 contract
Our client has been operating through a LTD company offering gas maintenance and services to the leisure industry, namely on boats. The company also had a contract with Fords Dagenham which was an IR35 friendly contract which is now coming to an end. As the income from the leisure industry has increased they have always wondered if this should be housed in a separate company, the revenue from this is not 50% of the turnover.
The new contract which has now been offered would be classed as high risk when you look at HMRC guidance, they are now considering the posibility of housing this new contract in its own separate company to keep it away from the leisure side. This could either have wife as shareholder/director or husband.
This would obviously benefit them when the paye tax and NI, IR35 calculation is performed, but would they have problems with HMRC with this structure.
Does anyone have any thoughts on this or carried out something similar?