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IR35 and status determination statements

1 September 2022

Same-Day Company FormationI have had quite a few conversations with clients recently relating to correspondence they have received from their end user clients.  Sadly, many are being told that they will either need to become employees or more likely that they must go through an Umbrella company if they wish to continue contracting.

Where I have spoken with clients that have received Status Determination Statements (SDS’s) from their clients, I have the following thoughts:

If you have an SDS stating you are in the opinion of the engager you are caught by IR35, this is not the end of the matter.  Firstly, this is a positive thing as it gives us a chance to plead our case and shows the client still wants to use PSC’s to carry out contracts for them.  Please get in touch with Lambert Chapman LLP and we can, firstly see if we agree with the SDS and secondly, assist you with a response to your client if we don’t agree. 

You can request clarification on a SDS decision and ask specific questions of your client and request a change of opinion. 

In the opinion of the author.  This is a very complex area of legislation based on case law.  HMRC are expecting your client to make a decision that might well be outside their area of expertise and one can quite understand why they might take an easy option of stating the PSC is caught.

If you need any assistance or if you have any questions about this – please get in touch with Duncan Forsyth at our London office – 0207 613 8161.