Interim management IR35 obligations – advice for our clients and contractors

Posted: 12th January 2017

Sarah Palmer - head of recruitment and interim managementWith more than 20 Interim Managers placed by Altair at any one time, we are often asked for advice on Interim contracts.

With changes to IR35 legislation coming into force in April 2017, we thought it would be helpful to inform our clients and contractors (in all sectors) about how it will affect them when working with, and through Altair.

IR35 was brought in by the Government in April 2000, to clarify the rules around whether an interim was truly self-employed or not and to counter what HMRC class as a disguised employment. In essence, interims need to be able to evidence that their contracts do not create an employer/employee relationship which would be subject to the usual rules in respect of income tax, National Insurance and VAT as well as a plethora of employee rights.

In principle, and to protect both clients and Interims, our self-employed interims are legitimately outside the scope of IR35 for the following reasons:

  • Type of role undertaken – our interims are skilled professionals and generally experts in their field
  • We do not tell our interims they must accept work – they can decline an assignment if they so wish
  • Working practices – our interims are not told how to do their work, they use their own skills, expertise and methods
  • Our interims do not provide a personal service, e.g. under the terms of our contracts, by agreement with the client, a substitute can be provided (given that the substitute is suitably qualified and possesses the necessary skills)
  • There is a high indication of financial risk on the part of the interim, e.g. the interim is required to provide the tools of the trade that workers customarily provide (e.g. knowledge, skills and experience) and major items of equipment needed to do the work e.g. themselves and a laptop
  • We do not have mutuality of obligation with our clients or our interims

Contrary to some myths, it doesn’t matter if interims work regular days/hours or flexible working hours as agreed with the client or that the work has to be done at a particular place.

In short, it is essential the interim is not under the direct control of the end user client. As such, clients should not discipline or line-manage the interim in any way thus avoiding creating an employer/employee relationship.

If in doubt – check your interim contracts and review the way they are being managed within the organisation. To check for yourself please use the Employment Status Indicator at:

If you would like to discuss your position with regard to IR35, please get in touch with Sarah Palmer, Head of Interim Management and Executive Search at Altair on 07806 602933. Andy Ballard can also be contacted at:

Altair is organising an event for our clients and associates on the latest thinking in Interim Management and will cover IR35 on 22 February 2017 – please email Sarah to register your interest at:

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