💼 IR35: What It Means for You — And How We Can Help

f you're a contractor, freelancer, or business hiring flexible talent, IR35 is more than just a tax rule — it’s a game-changer. And if you're feeling overwhelmed by the jargon, the shifting responsibilities, or the potential hit to your income, you're not alone. At QABC, we’re here to help you navigate IR35 with confidence.

🧾 What Is IR35?

IR35 is a UK tax legislation designed to prevent disguised employment, ensuring contractors working through intermediaries pay similar taxes to employees. It affects both contractors and businesses hiring them.

IR35 is a set of rules from HMRC that tries to figure out whether someone is truly self-employed or just acting like it to pay less tax.

Imagine this: You work for a company full-time, sit at their desk, follow their hours, take direction from their manager — but instead of being on payroll, you invoice them through your own limited company. That’s what HMRC calls “disguised employment.”

IR35 says: if you walk like an employee and talk like an employee, you should be taxed like one. Sounds simple? Not quite. The rules are complex, and getting it wrong can be costly.

🔍 How Do You Know If You’re “Inside IR35”?

This is where things get murky. HMRC looks at:

• Control: Does the client tell you how to do your job?

• Substitution: Can you send someone else in your place?

• Mutuality of obligation: Is there an expectation that they’ll keep giving you work and you’ll keep accepting it?

If the answer to these sounds like a regular job, you’re probably inside IR35 — meaning you’ll pay income tax and National Insurance like an employee. If not, you’re outside IR35, and you can keep your tax-efficient setup.

🏢 Who's Responsible?

Before 2021, contractors had to decide for themselves. But now, if you’re working with a medium or large company, they decide whether you’re inside or outside IR35. If you’re working with a small business, it’s still up to you.

This shift has made some companies nervous — many just put contractors inside IR35 to be safe, even if it’s not accurate.

💸 Why It Matters

Being inside IR35 can hit your wallet hard. You lose:

• The ability to claim expenses

• The flexibility of managing your own tax

• A chunk of your take-home pay

And here’s the kicker: even though you’re taxed like an employee, you don’t get employee benefits — no sick pay, no holiday, no pension. It’s the worst of both worlds.

🧩 Final Thoughts

IR35 isn’t just about tax — it’s about how we define work in the modern world. Freelancers and contractors bring flexibility, innovation, and expertise. But the rules haven’t always kept up. Whether you’re hiring or being hired, understanding IR35 helps you protect your income, your rights, and your future.

HMRC offers a free tool called CEST (Check Employment Status for Tax). It’s a good starting point — though not perfect — for understanding your IR35 position.

👉

💡 How We Can Help

At QA Business Consultancy UK Ltd, we’ve helped hundreds of contractors and businesses:

• Review contracts for IR35 compliance

• Assess working practices to determine true status

• Challenge unfair determinations

• Set up compliant working models (like umbrella companies or outside-IR35 engagements)

Whether you're a contractor trying to protect your income or a business trying to stay compliant without losing top talent, we’ve got your back.

Let’s Talk

IR35 doesn’t have to be a headache. With the right advice, you can stay compliant and stay in control.

Let’s make IR35 work for you — not against you.