Corporation Tax Act 2009 section 139

Deduction for deemed employment payment

Section 139 provides a trading deduction for intermediaries (such as personal service companies) that are required to account for a deemed employment payment under the IR35 rules.

• Where an intermediary is treated as making a deemed employment payment to a worker under the IR35 rules, it may deduct that payment when calculating its trading profits.
• The intermediary may also deduct any employer's national insurance contributions it pays in respect of the deemed employment payment.
• The deduction is given in the period of account in which the deemed employment payment is treated as made — typically the end of the tax year, though in some circumstances it may be treated as made earlier.
• No deduction for the deemed employment payment or the related employer's national insurance contributions may be claimed other than under this section, preventing any double deduction.