IR35 confusion for new job

Hi All , my wife looks like she has got a new job , she is an RGN Nurse and will be caring for a client in her own home for 36 hours every week and my wife will be in the middle with client and then an agency above , i can't get my head around ir35 , i am presuming my wife will be classed as the contractor and she should start her own limited company , will the agency deduct tax and national insurance contributions at source or will my wife be paid gross and then file a tax return at the end of the financial year and pay her owed tax and ni contributions then, also my wife for the time being would still work one day a week at her old job in a nursing home as an employee on paye ,does this job affect the ir35 , Thanks any advice appreciated.

Hi,

The off-payroll working rules make sure that a worker, sometimes known as a contractor, pays broadly the same Income Tax and National Insurance as an employee would.  

The client is the person who is or will be receiving the services of a worker. They may also be known as the engager, hirer or end client. A worker affected by the rules may provide their services through, a limited company, usually known as a personal service company (PSC), a partnership or another individual.  

The off-payroll working rules apply if a worker provides their services through their own intermediary, usually a limited company, often known as a PSC. The person responsible for determining whether the worker is employed for tax purposes, depends on if the client is, in the public sector, in the private and voluntary sectors or is a small business. In most cases, the client will be responsible for determining the employment status of the worker. However, if a worker provides services to a small client outside the public sector, the worker’s intermediary is responsible for deciding the worker’s employment status and if the rules apply.

It is likely that the agency is the client or worker's intermediary and will be responsible for determining the employment status of the worker. There is a tool to help you make this determination here:  

https://www.gov.uk/guidance/check-employment-status-for-tax

If the rules apply, the client is responsible for determining the worker’s employment status for tax, and they should produce a status determination statement (SDS) including the reasons for their determination.  

If the worker is deemed to be employed for tax purposes, the deemed employer must deduct Income Tax and employee National Insurance contributions from fees paid to the worker’s intermediary.

Employer National Insurance contributions and Apprenticeship Levy, if applicable, must be paid to HMRC by the deemed employer.

At the end of each tax year, your wife will need to submit a tax return. You can see more guidance here:

https://www.gov.uk/guidance/understanding-off-payroll-working-ir35

Thank you.

 

Thank You for the detailed reply , Best Regards David.