Income Tax Self Assessment - New "investigate me" questions

[Dundeegeorge]

Could you please point to the legal definition

Nope.

A service company is any company whose main trade is the provision of services of a person. This very definitely includes a Ltd company owned by one person where the bulk of that company's income is derived from that person providing themselves or their skills to an end-user. IIRC there is something in the actual definition about the relationship between person and end-user being one of employment if the 3rd party (service company) was not involved.

IMO ticking the box will not trigger an investigation per se but it will almost certainly trigger a status enquiry to examine your contracts for IR35 compliance. If any of your contracts fail, THEN you are likely to get a full investigation.

of a 'service' company, because it sounds like you're making it up.

[Bigbird]

As others have said I doubt if any legal definition of a "service company" exists.

HMRC started using the term in 1998/99 when they started to prepare the legislation that subsequently became IR35. No idea if there is a legal definition of a service company (doesn't look like it) but HMRC say

Intermediaries such as service companies can be set up to provide the services of a single worker to a client in circumstances where, if it were not for the service company, the worker would be an employee of the client.

As ex-HMRC staff that's how I was taught to think of it...........

[NotAllThere]

So a service company is one caught by IR35. And IR35 only catches service companies. There's a nice symmetry there.

[Dundeegeorge]

Result

So a service company is one caught by IR35. And IR35 only catches service companies. There's a nice symmetry there.

and since there's no such thing as a service company, IR35 is dead, long live IR36......