IR35 - Physical Presence

[jamesbrown]

For clarity, the company is US based, has employees in different countries, including the UK, all working from home. There are no premises outside of the US.

I understand there is a UK phone number that is redirected but that's as much as I know.

I think the company also falls under the definition of a 'small company' according to UK legislation.

Therefore, I believe that IR35 reform rules do not apply, but I was genuinely interested in what constitutes a physical presence, not as has been suggested, trying to fit the circumstances to my desire for the reform rules not to apply.

But what would happen if these assumptions were at some point found to be incorrect and the reform rules should apply? The client has done no IR35 assessment, there is no SDS. In those circumstances, isn't it them that feels the wrath of HMRC and I'm off the hook?

It depends. I work with US clients a lot, and they typically attempt to transfer liability in contract clauses. Anyway, physical presence is a UK branch office or PE, as I noted before. The latter can be a bit trickier than you might imagine, since a PE is established when a UK employee of the US company makes decisions for the company from the UK. However, if the client is at all sane, they will be familiar with this and will not have staff with a decision making role in the UK, i.e., create an unintended PE.