IR35 is tax legislation largely ignored by the government, until now. It can enable an individual, without a limited company, to operate as a contractor and have their tax calculated either through their agency or pay an umbrella company to do this for them. Most agency staff take out the third party and form a limited company. This means they have tax deducted from them under company tax legislation which is generally capped at 20%. Then they pay themselves a salary which falls under the taxable allowance. By forming a limited company, they can afford to save part of their gross income for sick and holiday pay. Being paid by an agency through PAYE or an umbrella company gives you very little rainy day money. Therefore you are probably better off being employed if you are the main income provider.
How to check if your in or out of IR35
The government have now set up a tool on the government website which enables you to check if your contract falls within the IR35 legislation. This does give various different outcomes. It has been reported to classify the similar contracts as both in and outside of IR35 and is a pretty useless tool (I wonder if IT contractors were asked to make this?). Most NHS trusts have put a complete blanket IR35 stamp on all contractors leaving no room for manoeuvre.
Other non-clinical fields, working in the public sector, have demanded a 15-20% increase in their contract rate, says Neil Lupin of Green Park recruitment agency. This is something that all agency radiographers in a contract with the NHS should be doing in order to obtain holiday and sick pay.