With any job, you are likely to need some sort of equipment, whether it is a laptop, hammer or a paintbrush. One of the tests of IR35 is looking at whether you use your own or not.
A permanent employee would expect to be provided with all the equipment they need to complete their work. As you work for your limited company and not your end client, you will need to supply your own equipment to undertake the tasks involved. The more imperative the equipment is to your work, the more important this is. Consider the common analogy of the milkman, for example, you would not be expected to provide your milkman with a milk float in order for him to deliver your milk. You would expect him to have his own. Likewise, you would not expect to hire a builder who asks you for a concrete mixer or a plumber who asks you for a wrench.
The Revenue may consider that those who do not use their own equipment are unlikely to be operating as a genuine business. A client’s provision of equipment that is needed to complete the job is indicative of an employment-like relationship. If a clause exists in the contract stipulating that the client will purchase any training or equipment on behalf of the supplier (contractor) then it is likely to fail an assessment, unless the equipment is highly specialised.
With the grey area that is the IR35 legislation however, there are always exceptions. Security is one of the main reasons for contractors requiring to use their client’s equipment or the necessity to use their client’s equipment to complete the work, which is particularly common among IT contractors whose work is integrated with the client’s systems. HMRC will look at the importance of using your client’s equipment in order to make an accurate assessment of the relevance of this test.