IR35—the general regime

The following Tax practice note provides comprehensive and up to date legal information covering:

  • IR35—the general regime
  • Scope of the general IR35 regime
  • Conditions where the intermediary is a company
  • The notional contract between the worker and the end client
  • Application of IR35 to office-holders (including directors)
  • Meaning of 'office-holder'
  • Office-holders who provide supplementary consultancy services
  • NICs deeming rules
  • Consequences of the general IR35 regime applying
  • The deemed employment payment or attributable earnings calculation
  • More...

IR35—the general regime

This Practice Note explains the general IR35 regime which applies where an individual worker provides services to an end client through an intermediary, such as a personal service company (PSC) or partnership, in circumstances where the individual would otherwise:

  1. for income tax purposes, be regarded as an employee or an office-holder of the end client, and

  2. for National Insurance contributions (NICs) purposes, be regarded as employed in employed earner's employment by the end client

other than where the end client is, from April 2017, a public authority or, from April 2021, a medium or large private entity with a UK connection (in which case, the off-payroll IR35 regime applies, see Practice Note: IR35—off-payroll workers).

The intention of IR35, both the general and the off-payroll regimes, is to ensure that the worker's income tax and NICs liability is broadly equivalent to that of an employee, and to impose a PAYE and NICs obligation. That obligation falls on different entities in the chain of supply depending on whether the general or the off-payroll IR35 regime applies. If the general regime applies, the obligation rests with the intermediary (ie the PSC).

For more on the history and background of IR35, see Practice Note: IR35—history, developments and key difficulties.

Scope of the general IR35 regime

The general IR35 regime applies where:

  1. an individual (the worker) personally performs, or is under an

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