Are you inside IR35 or outside it?
We published this several years ago. However, we thought it was worth bringing it to IT Contractors’ attention once more as the information is still current.
A ruling by the Supreme Court in Autoclenz Limited v Belcher puts IT Contractors in the frame for IR35 if their working practices differ from the terms of their contract.
As we know some contractors set up their contracts to make them look outside IR35 as much as possible while their actual working practices may put them inside IR35.
One example is Substitution where a contractor can send someone else in to do his work if he is unavailable for some reason.
However, even if it is in the contract, very few companies would allow a contractor to send someone else to do his or her work for them.
Indeed it has been ruled by Lord Clarke that if the contract and the working practices are different then the contract can be disregarded.
Although this Supreme Court ruling is not specifically about IR35 there would be ramifications for IR35 from it.
As it is a Supreme Court ruling it would apply.
Supreme Court and IR35
Contractors are advised to make sure that their contract reflects what they will actually be doing. It should reflect how they will actually be working or their whole contract could be disregarded.
They shouldn‘t be too greedy and start firing in lots of clauses which would take them outside IR35 if that is not the way they will actually be working.
This could prove counterproductive after the Supreme Court‘s ruling.
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