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SDS for IR35

IR35 Status Determination Statement

BS.SDS.01A

This IR35 Status Determination Statement template is designed to save time when a Client company prepares to complete a status determination statement (an “SDS”) where it has to issue an SDS to comply with the IR35 legislation coming into effect on 6 April 2021.

It assumes that a company (“Client”) will engage an individual (the “Worker”) through an intermediary company (“Company”) that the Worker uses to provide work or services to the Client. It also assumes that that there will not be any additional intermediary organisation between the Client and the Worker.

IR35 legislation only requires a Client company to issue an SDS where it is a “medium” or “large” (rather than a “small”) company as defined by the applicable legislation.

Each of the “reasons” set out in this template are only in the nature of suggestions. The lists of possible “reasons” are designed to focus your attention on some of the factors that you need to consider when preparing to complete each individual SDS that you have to issue in relation to each of your workers who provides you with services through a third party entity.

However, it will not be appropriate just to adopt and include the reasons set out in this template: the particular reasons that you will need to include in each case (and how each reason has to be stated) will depend entirely on the circumstances and on the nature and details of the role of each worker under their engagement.

Furthermore, the Client company is legally obliged to take reasonable care when determining whether the worker would have been an employee if they were engaged directly by the Client. If they do not take reasonable care, liability for deducting tax and NICs will remain with the Client. (HMRC provides some guidance on its website (which you can reach here ) as to what will be “reasonable care”.)

Before using this template, we recommend that you read the Guidance Note on Employment, Self-employment, and IR35 and Employment, Self-employment and IR35 Checklists here .

This document is in open format. Either enter the requisite details in the highlighted fields or adjust the wording to suit your purposes.

Optional phrases / clauses and notes are enclosed in square brackets. These should be read carefully and selected so as to be compatible with one another. Unused options should be removed from the document.

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