Status Disputes / employed or self employed? & IR35

Contractors and sub-contractors are particularly likely to be subject to a tax dispute with HM Revenue & Customs.  Two favourite areas of attack by the taxman are often known as Status Disputes and IR35 challenges.  Both can be very costly in forms of extra tax and interest (and penalties) if the tax officer wins.

Contractors with lots of sub-contractors are vulnerable to HMRC claiming that the workers are in fact employees (i.e. status disputes) and that the contractor should be responsible for PAYE and NIC.  HMRC will often re-open 6 and sometimes up to 20 years in seeking extra tax.
One man band companies where the director takes most of his drawings by way of dividends risk being classed as an IR35 company; forcing the company to pay tax and NIC on a PAYE–style basis:  plus interest (and maybe penalties).
HMRC don’t always obtain or consider all the relevant facts and are prone to interpret the rules in their favour; often ignoring important legal issues.

Lynam Tax has successfully defended many status disputes and IR35 tax enquiries.  We have also helped businesses put in place systems and contracts which make successful challenges by HMRC much less successful.  Avoiding a status dispute or IR35 tax enquiry is also a good way of avoiding an in-depth tax investigation.

If you are concerned about status or IR35 issues, or have an ongoing tax enquiry or tax investigation (including civil investigation of fraud enquiries) then call us today for a free in confidence discussion.  Call Paul Lynam now:  0845 643 9997