What is IR35?

IR35 is legislation that was introduced to combat tax avoidance by individuals who supply services to clients through a limited company, when they are doing the same job and operate under the same constraints as an employee, this is known as” disguised employment.”

This legislation states that contractors who are in fact “disguised employees” should be subject to the same Income Tax and National Insurance Contributions as any regular employee rather than the tax breaks and benefits associated with a Limited Company.

For example, if you receive paid holiday and sick pay from your client yet still operate through a Limited Company, this will be deemed as “disguised employment,” and you will be liable for the same tax as an employee.