HMRC’s starting point is that non-executive directors (NEDs) should be treated in the same way as executive directors for PAYE purposes. As office holder these individuals are taxed in relation to their director’s fees under ITEPA 2003 s 5 and SSCBA 1992 s 3. NEDs may also provide consultancy services to the same company; here, it is the nature of the consultancy arrangement which determines the tax and NIC treatment. The IR35 rules, including changes made by FA 2013, should be considered for NEDs receiving, via personal service companies, fees relating to several unrelated companies in which they hold offices.
