Employment Status for Tax

This module will enable you to

• Describe the operation of the IR35 rules and who they affect
• Understand the legal framework that sets out employee rights
• List the factors taken into account when determining employment status
• Explain the fundamental concept of mutuality of obligations
• Discuss factors that help determine whether someone is in business on their own account

About the module

Employment status is particularly topical right now. In recent years, HMRC have tightened the IR35 rules governing personal service companies and off-payroll workers, and there has been an increase in the number of tax cases being heard by the tribunals and courts.

In some cases the appellants have been successful, but in other cases, HMRC have won the day. It's important to understand how to navigate this tricky area successfully as there may be severe consequences for getting it wrong.

In most cases, it will be clear whether a relationship is one of employment or of self-employment. However, there will be situations where the position will not be so obvious and it is often necessary to use a combination of judgement, experience and legal precedents to resolve matters.