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IR35 - What does it mean for us?

What does IR35 mean for us?

I work as a bookkeeper and general manager for a small business that employs a number of sub-contractors on an as-and-when basis, usually for fieldwork. Much of our work is for Local Authorities and I've recently noticed a question about IR35 on tender documents - but I have always assumed it doesn't apply to our services as we are a company of ten employees, rather than a sole trader masquerading as a company. Plus our work is done in our own premises, we're not sitting in a LA office next to LA employees doing the same work - our expertise has to be bought in because they don't keep it in-house anymore.

I have 2 questions - 1) am I right to say IR35 doesn't apply to us at the moment (ie in relation to our Local Authority work)? And 2) when it is applied to private companies, as mooted in the budget, will we have to take our subbies on as casual employees? We don't guarantee the subbies any amount of work, many of them do other work for other people, they supply their own kit (with the exception of some bits of very specialist kit they don't own) and they are free to turn down work if they choose.

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24th Nov 2017 12:42

"... a small business that employs a number of sub-contractors on an as-and-when basis ... I've recently noticed a question about IR35 ... but I have always assumed it doesn't apply to our services as we are a company of ten employees ..."

So which is it? A company with 10 employees on zero-hour contracts or a company which uses sub-contractors as-and-when?

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By Fenella
to Euan MacLennan
24th Nov 2017 13:14

Sorry, to clarify, we have ten contracted permanent employees, and a pool of sub-contractors we employ as and when we have the work for them.

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24th Nov 2017 13:05

You appear to be under a misapprehension regarding who IR35 applies to.

It is not the status (public or private) of the business providing the work that is relevant, but whether or not the end client is a public body. In your case, the LA is and so you are already within the IR35 catchment, and should (if you actually pay the contractors) be assessing whether their contracts fall within or outside IR35.

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By Fenella
to SteLacca
24th Nov 2017 13:18

Soooooo, how do I work out if their contracts are within IR35? I've tried the HMRC website and it makes no sense, so I wondered if anyone on here had a better understanding.

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By Fenella
to SteLacca
24th Nov 2017 14:58

That's a great link, and it's answered my question. Thanks.

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