Tax losses insurance

Our role at FLB is to discuss with you the most appropriate form of trading and to assist you in determining whether or not your engagement is ‘caught’ by IR35. Although we rely on an independent opinion, some clients are still concerned that HM Revenue & Customs (HMRC) can challenge their status and reclassify their engagement(s) as being caught by IR35 which would leave them with a large tax bill.

There are insurance policies available which will reimburse this tax loss, which is essentially the difference between the tax and NIC you have paid on a remuneration package of salary and dividends and the amount you would owe if HMRC determined that the whole amount must be treated as PAYE. This tax loss can run into thousands of pounds because HMRC will also charge interest on earlier years and will seek to raise a penalty if they can.

One of these tax losses insurance policies, Survive35 TaxSafe, is arranged through Abbey Tax Protection. We have provided a link through to the Abbey Tax website for clients who would like to know about covering contracts and/or contract extensions which have been reviewed and "passed" by Abbey Tax as being ‘outside of’ (not caught by) IR35.

FLB are unable to advise on the insurance, but if you would like speak to someone, please contact Robert Fisher or Rebecca Walker at Abbey Tax on 0870 607 7000 or for further information, please e-mail them at survive35@abbeytax.co.uk

Tax losses insurance

5 Curfew Yard, Thames Street, Windsor, Berkshire, SL4 1SN