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1.4 The tax plan of a freelance consultant must consider IR35
C Should a freelance consultant apply IR35 or not ?
"The nation ought to have a tax system which looks like someone designed it on purpose. "--William E. Simon
  1. The more that the contract reflects circumstances associated with employment then the more likely it is that IR35 should be applied.
  2. However, if the contract exhibits traits associated with self-employment then the converse applies and the higher is the probability is that IR35 should not be applied.
  3. The existing tests used by HM Revenue & Customs to distinguish between employment and self employment are used to determine if IR35 should be applied to the contract.
  4. In addition to the contract itself the general working practices of the contractor should be considered e.g. are you genuinely working in business in your own right OR do you consider yourself to be more like a "normal employee" of the client you are working at?
The more you present a picture of a genuine commercial business then the more chance that you will not have to apply IR35 to your contracting income.
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