As most of us are aware, contractors who are caught by IR35 will be significantly worse off than those whose contracts are not deemed to be caught by the tax rules. HMRC can determine whether or not a contract represents "deemed employment" based on a number of criteria, including employment status rules as well as a growing number of Court rulings and precendents.

Understandably, many IT Contractors may wish to take out IR35 and/or general tax investigation insurance to cover them in the event of a status challenge by HMRC.

Over the past eight years since IR35 became law, a number of established products and services has become available to contractors to cover the costs of a tax investigation, and even to cover the tax and national insurance liabilities which may arise from an HMRC enquiry.

One of the leading providers of IR35-related cover is Qdos Consulting who offer two groundbreaking products:

1. Freelancer Tax Protection

The bulk of IR35 enquiries start with a PAYE compliance visit or an enquiry from a tax return and could possibly end up at a Commissioners' Hearing. For this reason Qdos offers Freelancer Tax Protection, affording total peace of mind in the event of a PAYE compliance visit or enquiry.

Your case will be handled by one of our team of tax specialists and fees that you would otherwise have to pay for representation are covered under the policy. All this for a premium of £99 (including Insurance Premium Tax) per year.

2. Tax Liability Cover (TLC35)

Qdos TLC35 covers not only representation costs, but also additional tax, NIC, interest and penalties arising from a HM Revenue & Customs enquiry. This provides contractors with a financial umbrella against the ever-increasing risk of enquiry.

To find out more about these offerings, please visit Qdos.