What Is an IR35 Contract Review Service?
An IR35 contract review service is a one-off compliance check on a contract you hold or are about to sign through your limited company. An accountant or tax specialist reads the written contract, compares it against your actual working arrangements, and gives you a written opinion on whether HMRC would consider you inside or outside IR35.
The review covers two things. First, the written terms: substitution clauses, control clauses, mutuality of obligation, and how the contract describes the relationship. Second, your real-world working practices: do you genuinely control your hours, can you send a substitute, and are you integrated into the client's business like an employee?
This is not a general check. It is a specific, documented assessment that you can rely on if HMRC ever opens an enquiry. As ICAEW qualified accountants, we see contractors who have worked for years assuming they are outside IR35, only to find their contract says something different. A review catches that before it becomes a problem.
Who Needs an IR35 Contract Review?
You need an IR35 contract review if you are a limited company contractor working through an intermediary (your own company) and you supply services to a client. The rules apply whether your client is in the public sector, a medium or large private sector business, or a small private sector business.
If your client is medium or large, they are responsible for issuing a Status Determination Statement (SDS) and deciding your IR35 status. You still need your own review. Why? Because the client's determination might be wrong. They might err on the side of caution and deem you inside when the facts say outside. Or they might get it right, but you want a second opinion before you challenge their decision.
If your client is small, the responsibility sits with you. Your company must decide whether the engagement falls inside or outside IR35. HMRC can still challenge that decision. A contract review gives you a defensible position.
Typical scenarios where a review makes sense:
- You are about to sign a new contract and want certainty before you start.
- Your client has issued an SDS saying you are inside IR35, and you disagree.
- You have been working under a rolling contract for years and have never had it checked.
- You are switching from a brolly or umbrella company to your own limited company.
- HMRC has opened a status enquiry into your company.
What the Review Covers
The Written Contract
The contract is the starting point. We look at every clause that affects status. The critical ones are substitution, control, and mutuality of obligation. If the contract says you must do the work personally, that points towards inside IR35. If it says you can send a substitute and the client cannot unreasonably refuse, that points outside.
We also check the notice period, the payment terms, and whether the contract describes you as a contractor or a worker. The language matters. HMRC will read the contract literally.
Working Practices
The written contract is not the whole story. HMRC can look at what actually happens on site. If your contract says you can send a substitute but the client has never allowed it, or if the contract says you control your hours but the client tells you when to start, the reality overrides the paperwork.
We ask you about your day-to-day working relationship. Do you report to a manager? Do you use the client's equipment? Do you attend team meetings? Do you get holiday pay or sick pay? Each answer shifts the balance one way or the other.
Client Size
The off-payroll rules (Chapter 10, ITEPA 2003) apply differently depending on client size. A medium or large client must determine your status. A small client leaves it to you. We check the client's size using the Companies Act definitions: turnover under £10.2 million, balance sheet under £5.1 million, and fewer than 50 employees. Two of the three must apply for the client to be small.
If the client is small, you are responsible for the determination. If the client is medium or large, they are. We tell you which side of that line your client falls on.
What You Get After the Review
You receive a written report that states our opinion on your IR35 status. The report explains the reasoning, references the relevant clauses and working practices, and flags any risks. If the contract needs changes, we tell you what to ask for.
We do not rewrite contracts. That is a solicitor's job. But we give you the specific clauses to raise with your client or their legal team. If the contract is clean and your working practices support outside status, we confirm that in writing. That written opinion is your best defence if HMRC ever enquires.
If the review says you are inside IR35, we explain the consequences. Your company must deduct PAYE and NIC on the fees you receive from that engagement. You file a Full Payment Submission (FPS) each month and pay the tax to HMRC. We can help you set that up.
When to Get a Review
The best time is before you sign the contract. Once you start working, changing the terms becomes harder. The client has less incentive to agree to changes once you are already on site.
The second best time is when your circumstances change. If you move to a new client, take on a different role, or your existing contract rolls over for a third year, get a review. HMRC can argue that a long-term engagement looks more like employment, even if the contract says otherwise.
The third time is when HMRC opens an enquiry. If you have received a letter asking about your IR35 status, do not respond alone. Get a review of the contract and your working practices first. HMRC gives you 30 days to respond to most enquiries. Use that time to get professional advice.
What an IR35 Contract Review Costs
Pricing varies by provider and complexity. A straightforward single contract review typically costs between £150 and £400 plus VAT. If the contract is complex, or if you need a review of multiple engagements, the cost rises.
Compare that to the cost of getting it wrong. If HMRC decides you were inside IR35 and you did not operate PAYE, they charge the tax you should have paid, plus interest, plus penalties. For a contractor earning £80,000 over two years, that can mean a bill of £30,000 or more. The review fee looks small by comparison.
Can You Do It Yourself?
You can use HMRC's Check Employment Status for Tax (CEST) tool. It asks a series of questions and gives you an opinion. CEST is free and takes about 10 minutes.
The problem is that CEST is not reliable for complex cases. It struggles with substitution clauses, and it does not handle multi-factor scenarios well. HMRC says they stand by CEST results if the answers are accurate, but they also say they are not bound by it. If your case is borderline, CEST often gives an "unable to determine" result, which helps nobody.
A professional review uses the same legal tests but applies them with judgment. An experienced accountant knows which clauses matter, which working practices tip the balance, and how to present the case if HMRC challenges it. You cannot get that from a web form.
What Happens If You Are Inside IR35?
If the review says you are inside, you have options. You can renegotiate the contract to move it outside. You can accept the inside status and operate PAYE. Or you can walk away from the engagement.
If you accept inside status, your company invoices the client as normal. But you must run payroll on the deemed employment payment. That means deducting PAYE and employee NIC from the fees, paying employer NIC, and reporting through RTI (Real Time Information). The net amount after tax is yours as a director.
You can still pay yourself dividends from other income your company earns. The inside IR35 engagement is ringfenced for payroll purposes. Your other work, if any, is not affected.
What Happens If You Are Outside IR35?
If the review says outside, you invoice the client gross, without PAYE deductions. Your company pays corporation tax on the profit, and you draw the remaining money as dividends or salary as normal.
Keep the review report with your company records. If HMRC ever asks, you produce the report as evidence that you took reasonable care. It is not a guarantee, but it shifts the burden. HMRC must show that your determination was unreasonable, not just that they disagree with it.
How to Get an IR35 Contract Review
Send us the contract and a summary of your working practices. We review the documents, ask any follow-up questions, and issue the written report within 5 working days. If the contract is urgent, we can turn it around in 24 hours.
We handle reviews for contractors across every sector: IT, engineering, consultancy, creative, construction, and professional services. If you work through your own limited company and supply services to a client, we can help.
Get in touch through our contact page or call the office. Tell us you need an IR35 contract review and we will talk you through the next steps.
If you are not sure whether you need a review, read our fundamentals page for a plain English explanation of how IR35 works. Then decide.