IR35 is a UK tax legislation that impacts all personal service companies (most commonly limited company contractors such as IT consultants). The legislation determines your employment status for tax (IR35 status) and in turn how much tax should be paid based on whether you’re providing services more like a business or more like a temporary employee.
Under the off-payroll working rules, a subsection of the IR35 legislation, any client business hiring a personal service company (with some exceptions) must assess the contractor’s IR35 status to determine the tax to be paid, and this tax must be paid directly to HMRC by the fee-payer.
This assessment is where a Qdos IR35 check comes in.
A Qdos IR35 check is an assessment of a contractor’s IR35 status (employment status for tax) on behalf of the hiring organisation (your client). You might also see it referenced as a “Qdos check”, “Qdos assessment”, “Qdos status review”, or simply just “Qdos” in job ads.
It’s a 40+ question assessment completed by you, the contractor, online via the Qdos Status Review platform. Your answers are then reviewed by one of our expert IR35 consultants based on 23+ years of experience handling IR35 enquiries and status assessments to provide an opinion of your IR35 status.
Your end client reviews your results and confirms their agreement, or alternatively disagrees and the consultant will liaise with both parties to finalise the decision, ultimately issuing a Status Determination Statement to each of you confirming the result.
Often you will see roles advertised as inside or outside IR35. This will be based on what we call a “role assessment”.
IR35 assessments are based on a range of factors concerning both the relationship with your client and how you operate as a business. A role assessment is an indicative view of your likely status based on some of these factors, such as whether the client would accept a substitute worker to fulfil the services or not. A role assessment doesn’t however look at factors related to how you operate as a business, such as whether you hold business insurance.
The role assessment is useful for contractors searching for a new role because it provides an indication of how much take-home pay (your fee after tax is deducted) you’re likely to earn, and so you can choose whether this role suits you or not before applying.
Once you’re hired (congrats!) we’ll carry out what we call an “individual assessment” which is the full assessment completed via Qdos Status Review, for an accurate IR35 status based on all factors.
The off-payroll working rules were introduced in the public sector in April 2017 and the private sector in April 2021. Prior to these dates, contractors were responsible for assessing their own status and paying the appropriate tax to HMRC. After these dates, the responsibility shifted to the end client and fee-payer respectively. The rules require:
Private sector clients who are classed as small don’t need to apply the rules. This doesn’t mean IR35 goes away, but that you will need to assess your own status and still ensure the correct tax is paid to HMRC.
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