18th July 2011

Marlen case could give contractors IR35 pointers

Court case provides lessons for contractors An IR35 case has reminded contractors of the importance of keeping records of contracts.

The victory of Marlen over HM Revenue & Customs in a case regarding IR35 legislation could have some important lessons for contractors, a former tax inspector has said.

Writing on Contractor UK, Kate Cottrell said the case underlines the importance of keeping records of the differences in terms for employees and themselves.

These included a lack of fixed hours, early termination of contracts and differing holiday and payment arrangements.

Gary Hughes, who worked as engineering contractor business Marlen, recorded evidence that he worked different hours to employees at JCB, which helped him to win his case.

"For contractors, this case also highlights the care that needs to be taken when answering questions posed by HMRC," added Ms Cottrell.

"The tribunal refers several times to conflict or confusion between what is set out on paper following meetings with HMRC and what appears to have happened in reality."

Additionally, the tribunal said Mr Hughes determined how he carried out his services rather than being told what to do.ADNFCR-3595-ID-800624998-ADNFCR

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