As ever with consultancy arrangements it is worth considering whether IR35 applies. It doesn’t apply to ‘small companies’ for which there is an exemption. A business will be small if it satisfies two or more of the following requirements:
- it has an annual turnover not exceeding £10.2m
- it has a balance sheet total not more than £5.1m
- it had an average of no more than 50 employees for the company’s financial year.
For companies of the above size, the IR35 risk is on the individual or the relevant personal service company