Contractors | HMRC drops IR35 enquiry carrying over £100,000 tax liability

IR35 advisory firm Qdos has successfully shut down HMRC following a year-long IR35 enquiry where the tax liabilities for the company under investigation could have exceeded £100,000.

The anonymous company has two directors, both of whom are contractors. It was initially notified of a Corporation Tax enquiry in 2017, but then was then told in January 2018 that HMRC would be carrying out an IR35 enquiry into two recent contracts - one of which was provided directly and one through an agency.

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After more than 12 months of correspondence, Qdos was notified by HMRC earlier this week that the IR35 enquiry was closed.

Qdos CEO, Seb Maley, said that the length of time it took to come to a decision was worrying. “It is of real concern that despite substitution having been exercised multiple times - and HMRC being aware of that at the outset - it took so long for them to accept that IR35 didn’t apply,” he said.