IR35 is the term given to the government legislation that was introduced by Inland Revenue in April 2000, and affects the payment structure of contractors using a limited company. Prior to its introduction, all contractors could receive their pay as a combination of a minimum salary and dividends thus paying only corporations tax, and avoiding payment of PAYE tax and National Insurance.

Since the introduction of IR35 however, it has been necessary for anyone working via a limited company to have his or her contract assessed as being “within the rules” or “inside IR35”; or “outside the rules” also known as “outside IR35”.

This assessment involves examining the wording of each individual contract to establish whether or not a contractor is deemed to be an (a) “genuine contractor” (outside IR35) or (b) 'akin to employed” (inside IR35).

As all of CXC’s services are compliant with the new MSC legislation and our contractors pay PAYE and NI on their earnings, they are paid in the same manner as an employee and are therefore paid on an inside IR35 basis.

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