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Use the Web to keep on the right side of IR35

by  David Dwyer on  26/11/2013

How a simple, professional site can position you as a genuine business

When is a business not a business? When the Taxman says it isn’t. 
 
IR35 is a piece of tax legislation well known to contractors and people who run their own businesses. Its intention is to tax workers in what the Inland Revenue calls ‘disguised employment’ at a rate similar to what they’d be paying if they were employees, rather than the lower rates applied to limited companies and their suppliers. The target of IR35 is people who work for one company but receive payments through another – usually a company they own themselves. 
 
If the Taxman decides that your particular business arrangement falls under IR35 guidelines, one major consequence is that you’ll pay a lot more tax and National Insurance than you do currently.
 
To determine which companies are legitimate ‘business entities’ and which are set up purely for the purposes of tax minimization, the Inland Revenue has a series of tests including:
  • whether a single client contributes more than 60% of a company’s turnover
  • whether a worker has a contract between the company that pays them and that client 
  • whether work is done in a client’s premises, using their equipment and under their control
  • or whether a worker has the right to substitute himself for another employee from his company.
 
It’s up to you to make sure the Taxman doesn’t think you’re in ‘disguised employment’. Simple precautions can help, like using your own equipment and premises or getting specialist advice on drawing up contracts. 
 
You can also make sure your company does the sorts of things other ‘proper companies’ do.  And here’s where we can help.
 
Inspire now offers a Website Package for Contractors, to help build their business profile, and demonstrate that they’re in business for themselves rather than employed and are actively seeking work. Our 5 year package includes:
  • The creation of a bespoke company logo 
  • A business stationery set, including 500 each of letterheads, comp slips and business cards
  • A website designed to win you more contracts, with a link to your Linkedin profile, client testimonials and an enquiry form
  • A business email address and your own domain name (registered for 5 years)
  • Promotion of your business phone number
  • Five years’ website hosting
 
The package comes complete at just £599 + VAT, which can be written off as a traceable, legitimate business expense. It’s just what anyone setting up in business for themselves needs, and is a whole lot cheaper than the cost of being caught out by IR35!

Download Our Flyer we created to promote:
 
David Dwyer is Managing Director of Inspire Web Development. He has years of experience in a range of web and IT roles plus seven years in sales and marketing in a blue-chip FMCG company. David’s academic and professional qualifications include a BA (Hons) in Business Economics (Personnel) from the University of Paisley, an MSc in Information Technology (Systems) from Heriot-Watt University and PRINCE2 Practitioner-level certification. He is also an active member of the British Computer Society.
 
Fair Process, HR, Inspire Web Development, Reputational Currency, Small Businesses, Technology Innovation, The Evolving Web, Web Consultancy, Websites for Accountant Clients, Websites for IR35 Guidelines
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