IR35 is a tax measure that applies to contractors who provide their services to businesses via a personal service company. At present , it is the personal service company that determines whether the income received for providing those services should be taxed as employment income or not.
However, from April 6, every medium and large private sector business in the UK will become responsible for deciding the tax status of any contractor they engage via a personal service company, under the new ‘off-payroll working’ rules.
IR35 will cease to apply and the onus will shift to the employer to determine whether income should be subject to tax or not.
For more information on these changes download our free factsheet here.