What Triggers IR35 Investigation

[ajayjain]

Hi,


I wanted to know what triggers IR35 investigation

Whereever I read, it is said that your contract agreement should be IR35 compliance. it should have this and that, but do you think if someone comes under IR35 can escape by presenting the agreement to HMRC,
If someone is contracting with a company for a long time
he can ask the customer to write all the IR35 related points

Also how HMRC pick the contractors to investigate ?
(company accounts, self assessments, P14-Expense, PAYE)

[accountancyextra]

You could be selected for investigation in many ways, it could be a box that you tick on your self assessment, your company sic code or the answers you give to questions on your P35.

The one thing to point out these days is that since the "Dragonfly" case, HMRC now look beyond whats in the contract and instead look at the actual relationship with the client. In other words, if you look and behave like an employee then you are within IR35 in HMRC's view, no matter what your contract says.

However, if you are genuinely running a business and taking all the risks associated with that, you have nothing to fear if you are selected for review

[GillespieBS]

And if you want to put your head as high above the parapit as possible:

Form a company called Your Name Consulting Limited
Pay yourself a salary of £5,875
Have SJD, ClearSky or other specialist contractor accountant as agents

Doesn't mean that you are caught but you may have to defend your position. It's recommended to have professional fee protection.

IMO