Payment deadlines for deemed salary if IR35 caught

[Bumfluff]

Hi,

If you were to fail IR35 is it correct to say any income your company earns needs to be paid as deemed salary within the personal tax year the invoices were paid or can it be deferred ?

For example your company gets invoices paid between the 1st June 2011 and 31st May 2012 which is your company year, would you have to ensure that you take the deemed payment for the invoices April 2011 to 6th April 2012 by April 6th 2012 ?

Two different accountants have given me different answers.

thanks

[northernladuk]

Hi,

If you were to fail IR35 is it correct to say any income your company earns needs to be paid as deemed salary within the personal tax year the invoices were paid or can it be deferred ?

For example your company gets invoices paid between the 1st June 2011 and 31st May 2012 which is your company year, would you have to ensure that you take the deemed payment for the invoices April 2011 to 6th April 2012 by April 6th 2012 ?

Two different accountants have given me different answers.

thanks

What is with all the IR35 questions all of a sudden????

You do not fail IR35, you are inside or you are outside depending on your working practices. Neither is a win or a fail.

[Bumfluff]

What is with all the IR35 questions all of a sudden????

You do not fail IR35, you are inside or you are outside depending on your working practices. Neither is a win or a fail.

I'm asking on behalf of someone, my accountant said something different to there's so going for a third opionion.

[Craig@Clarity]

When you say fail, assuming you mean you are caught by IR35/inside IR35 or variants thereof, the deemed salary is calculated on a cash basis. So you would include the invoices which were paid (net of VAT which could mean net of flat rate VAT) to your company between 6 April - 5 April. Any associated PAYE and NIC resulting from the deemed salary calculation has to clear HMRC's bank account by 22 April.