How to Challenge an Inside IR35 Determination
Understanding the Stakes: Why Challenge Inside IR35 Status?
Hey there! Let’s make a tricky subject more manageable. For countless contractors across the UK, being classed as “inside IR35” often comes with major financial and professional consequences. Feeling you’ve been treated unfairly? You’re not alone. The rules may seem stacked against you, but there are well-established avenues to question and potentially overturn an inside IR35 status. This guide walks you through each step, arming you with the tools and insight needed to take action.Gather What You’ll Need: Essential Materials and Evidence
Before making your case, preparation is everything. Here’s what to gather:- Copy of your contract, ideally in full (not just the scope of work or summary)
- Correspondence and emails with the client explaining your role, responsibilities, and working practices
- Project documentation, like timesheets, meeting notes, or deliverables
- Assignment Details Statement, provided by your client or agency (required by law for all contractors)
- HMRC’s CEST (Check Employment Status for Tax) results, if already completed
- Invoices and payment records showing how you are paid
- Company’s written IR35 determination and your reasons for disputing it
- Notes on your actual working practices—including autonomy, control, substitution, and financial risk
- Legal or professional advice (emails, reports, or calls) supporting your status
- Reference specific disagreements.
- Attach relevant supporting documents.
- Clearly state why your engagement falls outside IR35, using HMRC’s own criteria—control, substitution, mutuality of obligation.
- Keep records of all correspondence and responses.
- Make clear the points of law or fact that support your case.
- Delayed Responses from Clients Clients must reply within 45 days, but sometimes they don’t. Chase them courteously with reminders and request acknowledgement of your correspondence.
- Unclear Contractual Terms If your contract is vague, back your case up with real working practice evidence: emails, meeting notes, and actual ways of working.
- CEST Tool Discrepancies HMRC’s Check of Employment Status for Tax tool results often differ from your view. Point to independent assessments or legal opinions where possible.
- Agency vs. Client Confusion Clarify who issued the determination. Speak to both parties if needed, ensuring all documentation can be traced back to the source.
- Document everything
- Never be afraid to ask for clarification
- Stay persistent: many contractors successfully reverse their status
A paper trail is your ally. The more detailed your materials, the stronger your case.
The Challenge Process: Step-by-Step
Challenging your IR35 determination often feels daunting. Let’s break it down:1. Understand Your Determination Read the written status determination statement (SDS) provided by your client or agency. This document must specify why you are deemed inside IR35, referencing your working practices.
2. Request a Written Explanation Not satisfied with the rationale? Ask your client or agency for a full written explanation. This can clarify any misunderstandings early.
3. Respond Formally Draft a written response disputing the decision.
4. Leverage the Client’s Disagreement Process Since April 2021, clients have a legal duty to respond to disagreements within 45 days.
5. Seek Professional Advice Consider engaging an accountant, legal expert, or reputable IR35 specialist—especially for complex cases.
6. Contact HMRC (If Necessary) If the dispute remains unresolved, you may contact HMRC, but be prepared: their decisions aren’t always swift, and they may apply scrutiny to both past and future engagements.
Common Sticking Points and How to Solve Them
Even when you’ve followed every step, problems can arise:What Next? Strengthening Your Position and Moving Forward
Challenging inside IR35 status is rarely simple, but it’s achievable. Take ownership of your case, maintain meticulous records, and know your rights. If you’re unsure at any stage, professional support—not just online forums—can make all the difference.Every contract is unique. Your journey may differ, but an evidence-led, patient approach significantly improves your chance of success.
