No substitute for clarity in IR35 determination

The three key factors of personal service control and mutuality of obligations are still critical to evaluating the hypothetical contract which would exist between the parties if the intermediary (the contractor’s limited company) were removed. In the context of the test of personal service it is important to understand the core differences between subcontracting and substitution.

Precedent

Despite recent tribunal decisions in favour of contractors on the basis that they could demonstrate clear in-business factors (Basic Broadcasting Ltd (TC8400) (9 February 2022) – Adrian Chiles – and Atholl House Ltd v CRC [2022] EWCA Civ 501 – Kaye Adams) these arguments are not going to work for the more traditional contractor working for one end client at a time; and this was emphasised in the fact that the Court of Appeal overturned the Upper Tribunal’s decision in Ms Adams’ case in favour of HMRC.

So we are...