Most crew work through one of three set-ups: a limited company, as a sole trader, or PAYE, usually through the production company.

What does this actually involve?

You register your own limited company, which invoices the production for your work. Your company pays you a combination of salary and dividends, and you're responsible for Corporation Tax, and usually VAT once you're above the registration threshold. Most contractors use an accountant to handle this.

Why do people choose it?

It's generally the most tax-efficient route for higher earners, since dividends aren't subject to National Insurance, and you can claim a broader range of business expenses than an employee could. The catch is that this only holds up if both the production company and HMRC agree you're genuinely working "outside IR35" (more on this further down the page).

What does it cost, and is it actually worth it?

Expect to pay an accountant somewhere in the region of £1,000-£2,000+ a year to do your company tax return (due within 12 months of your year-end) and your accounts to Companies House (due within 9 months). You'll also need to register for VAT once your turnover passes £90,000. As a rough rule of thumb, running a Ltd company only tends to pay off once your annual profit is above about £50,000-£60,000, below that, a sole trader set-up is usually simpler and cheaper for the same money.

What does this actually involve?

You're self-employed in your own name rather than through a company. You register for Self Assessment, invoice directly, and pay Income Tax and Class 2/4 National Insurance on your profits once a year (or more often once Making Tax Digital applies to you, see below). There's no company to set up or wind down, which makes it the simplest option administratively. You only need to register with HMRC once your turnover passes £1,000 in a tax year, below that, there's nothing to file.

So why doesn't everyone just do this?

IR35 itself doesn't technically apply to sole traders, it's a set of rules about intermediaries like limited companies. But HMRC has a separate, similar test for whether someone taken on as "self-employed" should really have been an employee, and if a production gets that wrong, the liability can land on them. Because of that risk, many productions simply won't engage a sole trader directly unless the role clearly passes that same self-employment test.

What does it cost, and when are the deadlines?

Accountancy fees are typically much lower than a Ltd company, around £300-£500 a year, and some sole traders manage it themselves. Your Self Assessment return and any tax owed are due by 31 January following the end of the tax year, and if your bill is large enough, you'll also make "payments on account" towards the following year's tax in January and July.

What does this actually involve?

You're taxed at source, Income Tax and National Insurance come off before you're paid, same as any other employee. You get a payslip, and you're legally entitled to statutory sick pay and holiday pay on top of your day rate. In practice, productions can be cheeky about this: some quote your rate as already "inclusive" of holiday pay, so nothing extra is paid, and where it is paid separately, it's often held back and only paid out at the end of the production rather than as you accrue it.

PAYE is the fallback when a job is ruled "inside IR35," since it sidesteps the whole determination.

Expenses are more limited here too. As an employee, you can generally only claim for costs that are work-related and that you haven't already been reimbursed for, not the broader range available to a sole trader or Ltd company. If you're mixed status, some PAYE and some self-employed work in the same year, you can still claim things like your own equipment through a Self Assessment return.

Pensions

PAYE employees, working directly for the production company, are automatically enrolled into a pension, with employer contributions added on top of your own, and those employer contributions compound over the years. Sole traders and Ltd company directors don't get that automatic top-up, so it's worth setting up and paying into a personal pension yourself rather than assuming it'll happen by default. If you've built up pots with different companies or employers over the years, these can usually be merged into one, though an employer can't direct their contributions into a pot of your choosing.

Mortgages

Freelancers of any status generally need 2-3 years of consistent, documented income to satisfy a mortgage lender, and the range of lenders willing to offer freelancer-friendly terms is narrower than for someone on a standard payslip. A mortgage broker who specifically works with self-employed or contractor clients is often worth the fee if you're planning to buy.

What is it, in plain terms?

IR35, also called the off-payroll working rules, exists to catch "disguised employment": someone working through a limited company in a way that, in practice, looks just like being an employee. Where that's the case, HMRC wants roughly the same Income Tax and National Insurance collected as if they'd been on payroll all along.

Who decides my status?

For medium and large productions or companies, the client (the production, or whoever's engaging you) has to make the determination and give you a Status Determination Statement, not you, and not your accountant. Many use HMRC's CEST (Check Employment Status for Tax) tool to do this. Only genuinely small companies are exempt from making that determination themselves, in which case it falls back to your own limited company to self-assess.

That "small company" exemption got wider from April 2026: the turnover threshold that qualifies a company as small rose from £10.2m to £15m, and the balance sheet threshold from £5.1m to £7.5m (the 50-employee limit didn't change). In practice, this means a few more production companies now fall under the small-company exemption, so the determination duty shifts back onto individual limited companies working for them, worth checking rather than assuming.

The determination usually comes down to three things: whether you could send a qualified substitute in your place, how much control the production has over how, when and where you do the work, and whether there's an expectation that work will keep being offered and accepted (mutuality of obligation). The more those look like an employment relationship, the more likely you're inside IR35.

Large broadcasters and studios have increasingly defaulted to "inside IR35" for anything that looks remotely like ongoing crew work, simply to avoid the risk of getting a determination wrong. HMRC does publish guidance and a list of roles that it considers to be outside IR35. If your role is on the list, it makes it a lot easier to persuade a production company that you can be Ltd or a sole trader.

What is Making Tax Digital for Income Tax?

It's HMRC's move away from one annual Self Assessment return, towards keeping digital records and sending quarterly updates throughout the year, plus a year-end declaration to finalise your figures. Compatible cloud accounting software, FreeAgent and Xero are two commonly used ones, handles the record-keeping and the submissions, and updating it weekly rather than saving everything for year-end makes the quarterly filing far less of a scramble. It's being phased in by income level:

How does this land differently depending on how you work?

• Sole traders. This is who Making Tax Digital is actually aimed at. If your self-employment (and any property) income crosses the relevant threshold, you'll need to move to digital record-keeping and quarterly updates from the date that applies to you.
• Ltd company contractors. Not affected by this at all. Making Tax Digital for Income Tax only applies to Self Assessment, and your limited company already files separately through Corporation Tax, so this change doesn't touch you directly (though Making Tax Digital for Corporation Tax has been talked about for the future, nothing's confirmed yet).
• PAYE. Also unaffected. Your tax is already deducted and reported by your employer in real time, there's no Self Assessment income for these rules to apply to.