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In Northern Light Solutions Ltd v HMRC [2021] UKUT134, the Upper Tribunal (UT) agreed that IR35 applied to a Personal Service Company (PSC). The control and mutuality tests were met and an obligation for personal performance made the right of substitution almost theoretical.

Robert Lee was a project manager for the Nationwide Building Society (NBS) through a Personal Service Company (PSC), Northern Lights Solutions Limited (NLS).

On appeal, the Upper Tribunal (UT) upheld the decision of the FTT.

Useful guides on this topic

IR35: Off-Payroll Working
What is IR35? How does it work? How is the deemed payment calculated? What expenses are deductible?

Personal Service Company (PSC) tax
What is a PSC?  What are the tax implications for a PSC?  PSC tax 

Off-Payroll Working: PSCs & Private Sector Engagers
What is Off-Payroll Working? Who does it apply to? What are the rules?

Employment Status: Mutuality Of Obligation
What is mutuality of obligation? What do the courts say?

Employment status & detailed checklist
An employer (including an Employment Agency) must assess any worker's employment status so that they can fulfil their obligations under employment and tax law.

External link

Northern Light Solutions v HMRC [2021] UKUT134 


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