Contracting business ECR Consulting wins IR35 case after five-year battle with HMRC

IR35 Test

IT contractor Elaine Richardson has won her IR35 case after battling with HMRC for over five years over its claim for more than £50,000. A tax tribunal has ruled that her contractor limited company, ECR Consulting, “is a genuine business and therefore not the target of the IR35 legislation”.

The tribunal’s focus on Richardson’s status of ‘being in business on her own account’ could signal a shift of thinking by tax tribunals towards recognising that the classic tests of employment and IR35 status – control, substitution and mutuality of obligation – are increasingly irrelevant in today’s knowledge economy, and can no longer reflect modern flexible working patterns.

Richardson’s company was originally facing an IR35 tax bill in excess of £50,000, relating to her company’s contract work for client Vertex Data Science. Fortunately, her tax investigation insurance, provided through her membership of PCG, funded representation by IR35 experts Accountax Consulting.

Accountax Consulting’s Matt Boddington, who represented ECR Consulting at the recent tribunal hearing, successfully argued that Richardson’s relationship with Vertex Data Science lacked the essential characteristics of employment and it was clear that she was in business on her own account, and not subject to IR35.

Boddington says: “What is particularly pleasing about this judgement is that the tribunal had their commercial heads on, and understood that contracting through a single person limited company is a prudent and sensible method of providing freelance services, and not just about disguising employment.”

Published: Friday, May 13, 2011

© 2015 All rights reserved. Reproduction in whole or in part without permission is prohibited. Please see our copyright notice. If you want to use any content you have seen on this site then please request our media pack and ask for details of our Content Licencing Service.

Inni Accounts


Readers Comments...


  
Bookmark and Share
  
     
  

Latest Site Updates

ContractorCalculator: Contracting news in brief – 22/May/2015 ContractorCalculator: Contracting news in brief – 22/May/2015

News this week covers: London’s financial sector; digital skills in demand; Scotland’s market recovers; oil & gas investment; & late payments plans.

Digital and big data contractors increasingly in demand to fill widening skills gaps Digital and big data contractors increasingly in demand to fill widening skills gaps

Contractors with digital and big data skills enjoy increased opportunities, as contracting clients struggle to innovate, says Harvey Nash/KPMG survey.

Contractors in IT and engineering are sought after, as key skills get harder to find Contractors in IT and engineering are sought after, as key skills get harder to find

Contracting opportunities in IT & computing and engineering will rise, as key skills become harder to find, forcing employers to turn to contractors.

Contractors may end up underwriting George Osborne’s July 2015’s Stability Budget Contractors may end up underwriting George Osborne’s July 2015’s Stability Budget

Contractors may end up underwriting the Chancellor’s Stability Budget in July 2015 by losing tax reliefs and being swept up by anti-avoidance rules.


  
  

Twitter

Follow Us On Twitter


  
     

  
  

Contractor solutions

Contractors Handbook IR35 Report - 15 Years IR35 Test Clever Accounts Accountants Checklist CFSC Left Sky
  
  

Contractor solutions

Contractor Angels

Take home over 88% from your income. 100% compliant. Calculate now!

InTouch Accounting

Perfect mix of technology & personal service for only £92 per month.

Parasol

The UK’s largest employment organisation - 0% risk, 100% compliance

Clever Accounts

Complete contractor accounting service. 24/7 online access. £69 pm!

NA D J Colom Accountants Bedouin Group Mortgages NewsNow
  
Contractor Insurance Life Insurance

  

The UK's leading contractor site. Independently audited traffic (ABC) – 135,209 monthly unique visitors.