The right of control is important – even if it’s not exercised
One of the key indicators of IR35 status is the right of control – if a contractor’s client contractually has the right to control how they carry out their work, the contractor may well fall under IR35 legislation. Although control is not a decisive factor it must be considered as part of the overall picture. The important thing to note is that the mere existence of the right of control counts, even if that right is never exercised.

The other factors besides control that must be looked at, if the worker is an expert
The absence of control may not always be useful in deciding whether a worker is an employee or a contractor. For example, an airline would not instruct a skilled pilot on how to fly a plane. Any of your clients hired as experts in their own fields will need to look at other factors of the contract, besides control, to determine whether or not it is a contract of service.

Mutuality of obligation is key to establishing whether a contract of any kind exists
Mutuality of obligation means that the engager must pay consideration to the contractor and that the contractor must carry out the work offered. Without these two points there cannot be a contract in existence, either a contract of service or a contract for services.

Once the contract is established, HMRC says that the matter of whether the contractor has to accept the work offered, or whether the engager has to offer work once work is being carried out, is irrelevant to the question of whether the contract actually exists.

Occasional delegation is consistent with a contract of service
The question of personal service and the right of delegation often causes difficulties for clients who operate alone. HMRC says that if a worker can occasionally send a substitute in their place, this in itself does not mean that the worker is not an employee.

Mutual intention is only considered if the other factors don’t point one way or the other
There is a common opinion in the accountancy profession that it should be for the contractor and the engager to decide whether they wish the relationship to be employee-employer or contractor-engager. However, HMRC says that mutual intention will only come into play as a deciding factor if the other key factors in the arrangement do not show a clear direction towards employment or contractorship.