From alchemy to obituary

THE PERSONAL SERVICES legislation colloquially known as IR35 has been in force since April 2000.

One would have expected that five years would be long enough for the legislation to be understood by both taxpayers and practitioners. In the case of IR35 however myths continue to circulate. These often revolve around an 'IR35 proof contract' which magically transforms the dross of an employee-style working relationship into the gold of self-employment. These contracts are likely to contain a right of substitution the right to decide when and how to work and a right to hire others to work with the contractor all of which are well-established indicators of self-employment.

A belief in magic is perhaps not surprising given that the IR35 legislation is itself built on an imaginary or 'hypothetical' contract between the worker and the end-user. In order to work...