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Outside the scope of IR35?

Outside the scope of IR35?

A company has 2 equal shareholder/directors and is currently paying low salary/high dividend.  If the directors were to set up their own individual companies and rather than take salary and dividend, invoice the original company, would there be any IR35 issue?


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29th Mar 2010 23:03

Is it now a "3rd party client"?

Hi - IR35 can only apply if the client is a 3rd party, ie I can own as many companies as I want and provide my services through & to them all but because they are owned by me, the "clients" are not 3rd parties and so IR35 won't apply.

So if your clients retain ownership of the original company then it's not a 3rd party but if they've sold it on to someone else then, depending upon the other IR35 rules over their working relationship & methods, then there might be an IR35 problem

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