IR56 Advice
What you need to know about IR56.
The question of whether your contract is “Deemed Employed” or “Self-Employed” is fundamental to how IR35 is applied, so HMRC issued IR56 to clarify things.
Here are some example questions used within the IR56 test:
- Do you have to fulfil the contract personally (as opposed to subcontracting or using a colleague)?
- Do you have a "manager" at the client who tells you what to do, how to do it and when to do it?
- Are working hours fixed both in terms of when and for how long you work?
- Do you risk your own money?
- Do you provide all the main equipment required to complete the job?
The results of this questionnaire are not sufficient on their own to fully determine your status as it can be open to much personal interpretation, especially when there is a monetary incentive attached to the outcome.
Your actual employment contract or contract for services would also need to be professionally assessed; this is known as an “IR35 review”. This can cost up to £200 per contract and is what usually detours most contractors from entertaining the “Self-Employed” route.
For more information on our Umbrella Company Solution and how IR56 can affect your decision, speak to one of our advisors on 0800 848 8888.
Alternatively, you can contact us online via our Live Assistant or request a call back and an advisor will contact you to help you with your query.