IR35: What Falls Outside The Rules

IR35: What Falls Outside The Rules

IR35: WHAT FALLS OUTSIDE THE RULES There are a number of factors to consider when deciding if IR35 applies to a contractor, including the written contract, and how the contract compares to the day-to-day practices of the contractor in question.

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If the contractor can be substituted for another then the worker may fall outside IR35, but if the individual contractor is required for their personal service, they are likely to be within IR35

The factors that determine whether the relationship between employer and contractor is a ‘business’ relationship (which falls outside IR35), or an ‘employment’ relationship (which falls inside IR35) include the following:

• If the contractor can be substituted for another then the worker may fall outside IR35, but if the individual contractor is required for their personal service, they are likely to be within IR35

• Consider if there is the presence of mutual obligation, i.e. is the client obliged to offer the contractor work and/or is the contractor obliged to accept it?

• Another key factor to consider is how much control the client has over the contractor and their work, as this will help to determine whether the worker is inside or outside IR35

CHRIS SHORT

For further information about IR35 and other matters related to recruitment, visit the blog of Chris Short, Concept Resourcing CEO.