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IR35 insurance is not a fixed-price product, and there is no single figure that represents what it costs. The premium depends on your contract value, the type of policy, the cover limit, and which provider you use, and the main providers do not even price it the same way. Qdos and Roots publish annual premiums. Markel Tax's Survive35 TaxSafe is priced per individual engagement through brokers rather than as an annual policy. Kingsbridge publishes no price at all.

This guide sets out what each provider actually charges, sourced to their own published figures where they exist, rather than a single generalised market rate.

The two types of cover

There are two distinct types of IR35 insurance product in the market, and the difference between them is significant.

Legal defence cover pays for the professional fees involved in responding to an HMRC enquiry: specialist accountants, tax advisers, and potentially legal representation. It does not cover the tax, National Insurance, interest, or penalties if HMRC wins.

Tax liability cover includes everything in legal defence cover and also pays the tax, National Insurance, interest, and penalties that become due if HMRC successfully argues you were inside IR35.

The difference in price between the two policy types reflects the difference in what they actually cover. Legal defence cover transfers the cost of the fight. Tax liability cover also transfers the cost of losing.

What Qdos publishes

Qdos publishes both types of cover directly on its own site. Legal Protection Insurance starts from £5.88 a month, covering up to £50,000 of representation costs per claim. Tax Liability Cover (TLC35) starts from £16.58 a month at the entry tier, covering £25,000 of liability cover plus £50,000 of enquiry defence cover, with indemnity limits rising to £250,000. Both are annual policies billed monthly, and a £250 excess applies to the liability element.

What Roots publishes

Roots publishes Contractor IR35 Protect from £50 a year including Insurance Premium Tax, covering £100,000 of legal defence costs per claim, with an option to add £100,000 of tax liability cover. This is an annual policy.

What Markel Tax publishes

Markel Tax's own site does not list a price for Survive35 TaxSafe, its contractor-facing tax losses insurance product. Its broker, Caunce O'Hara, publishes premiums starting from £329 including Insurance Premium Tax, based on a business consultant with annual contract value up to £75,000, a clean claims history, and an IR35 contract review. Survive35 TaxSafe is priced per engagement rather than as an annual policy, so this figure is not directly comparable to Qdos's or Roots's annual premiums.

What Kingsbridge publishes

Kingsbridge does not publish a price for its IR35 cover anywhere on its own site. Quotes are provided individually, online or by phone.

Why these figures are not directly comparable

Qdos and Roots price IR35 insurance as an annual premium, so their figures can be compared to each other on a like-for-like basis. Markel Tax's Survive35 TaxSafe is priced per engagement, which means the £329 figure reflects a single contract rather than a year of cover, and does not convert cleanly into an annual number. Kingsbridge publishes nothing to compare at all. A single blended market price cannot be constructed from these four without either ignoring the differences in how they price cover, or stating a number none of the four providers actually publish.

What drives the premium up

Several factors affect what you pay, though how much depends on the provider and policy type.

Contract value. Premium scales with your annual contract income because that income determines the size of the potential tax liability. A contractor on £300 per day for 220 days has a very different exposure from one on £800 per day. Insurers price accordingly.

Cover limit. Qdos's Tax Liability Cover, for example, is available at indemnity limits ranging from £25,000 to £250,000. The limit you choose directly affects the premium. Indemnity limits below £250,000 can be exceeded quickly in a multi-year investigation with penalties and interest, which is one reason many policies are sized above that level.

Number of engagements. Some policies cover a single contract. Others cover all of your limited company's contracting activity. If you work across multiple concurrent engagements, a policy that covers all of them costs more than one tied to a single contract.

Claim history. A clean history of no prior HMRC investigations keeps premiums down. A previous enquiry may lead an insurer to apply a loading or, in some cases, decline to offer cover.

Sector. Some sectors attract heightened HMRC scrutiny. Public sector contracting and financial services engagements are areas where insurers sometimes apply slightly higher premiums, reflecting the elevated investigation risk.

Comparing the cost to the exposure

The premium question only makes sense alongside the exposure question. What would an IR35 investigation actually cost you if you had no cover?

The answer has two parts. The first is defence costs: professional fees for specialist accountants and advisers to respond to HMRC correspondence, attend meetings, and if necessary represent you at tribunal. These costs accumulate regardless of whether HMRC is right. A straightforward enquiry that resolves at correspondence stage might cost £5,000 to £15,000 in fees. A contested case that runs to a First-tier Tribunal can easily exceed £30,000 to £50,000 in professional fees alone.

The second part is the potential tax liability if HMRC wins. The exposure here is driven by day rate, contract length, and how many years fall within the investigation window. HMRC can investigate up to four years back under normal circumstances and up to six years if they believe an error was due to carelessness. A contractor at £500 per day across 220 days has annual contract revenue of £110,000. A successful IR35 challenge on that engagement for a single year can produce a combined income tax and National Insurance demand in the range of tens of thousands of pounds, before penalties and interest are added.

The Atholl House Productions Ltd v HMRC [2022] EWCA Civ 501 case is the clearest illustration of what the uninsured defence cost looks like in practice. Kaye Adams spent nine years and four separate hearings defending her IR35 position. She won, but the professional fees incurred over that period were substantial. Without insurance, those costs fell on the contractor throughout.

The price of a contract review versus the cost of insurance

One comparison worth making explicitly: Qdos's own full IR35 contract review, a clause-by-clause written status opinion, costs £125 plus VAT. Qdos's Tax Liability Cover starts from £16.58 a month, around £199 a year, at the entry tier.

These are not alternative purchases. They serve different purposes. A contract review tells you what your status looks like; insurance covers the cost if HMRC disagrees with that assessment. The contractor who buys a review but not insurance knows their position but carries the full financial exposure of defending it. The contractor who buys insurance but has never had their contract reviewed is paying to transfer a risk they have not actually quantified.

Understanding your position and sizing insurance against the residual risk are two separate steps. For more on the scale of the underlying risk, the HMRC IR35 investigation cost guide covers that in full.

What IR35 insurance premiums are deductible against

Premiums paid through your limited company for IR35 insurance are generally treated as an allowable business expense. That means the net cost is reduced by the corporation tax saving: at the current 25% main rate of corporation tax for companies with profits above £50,000, Qdos's Tax Liability Cover at around £199 a year has a net cost of about £149 after tax relief. For companies within the small profits rate, the saving is proportionally smaller, but the principle applies.

This does not change the decision, but it is worth accounting for when comparing premium cost to potential exposure.

How to work out the right cover limit

The cover limit on a tax liability policy should reflect the realistic tax liability across the years HMRC could investigate, not just the current contract year. To size this correctly you need three numbers: your average annual contract income, the number of years within HMRC's investigation window for which you operated outside IR35 through a limited company, and a rough estimate of the tax and National Insurance that would become due if those years were reclassified.

Your contractor accountant is the right person to produce that estimate. The IR35 Verdict contract checker shows where your current contract sits across the six case law dimensions that tribunals actually apply, which indicates how much investigation risk the engagement carries.

Check your contract before you size your cover

How this series fits together

This article covers what each provider charges for IR35 insurance and how to size the cover. The first article in the series, what an HMRC IR35 investigation actually costs, sets out the scale of the underlying risk. The third, what does IR35 insurance cover, sets out exactly what each policy type includes and the conditions that apply to any claim.

The honest cost summary

Qdos publishes £5.88 a month for legal protection cover and £16.58 a month for Tax Liability Cover at the entry tier. Roots publishes £50 a year including Insurance Premium Tax for its legal defence cover. Markel Tax's Survive35 TaxSafe starts from £329 including Insurance Premium Tax via broker channels, priced per engagement rather than annually. Kingsbridge publishes no price at all; cover is quoted individually.

For a contractor billing £500 per day, Qdos's entry-level Tax Liability Cover premium of £16.58 a month is less than the income from a single hour of work. For how the main providers compare beyond price alone, see our provider guide.

Frequently asked questions

How much does IR35 insurance cost per year?

There is no single figure. Qdos publishes £5.88 a month for legal protection cover and £16.58 a month for Tax Liability Cover (TLC35). Roots publishes £50 a year including Insurance Premium Tax for legal defence cover. Markel Tax's Survive35 TaxSafe starts from £329 including Insurance Premium Tax via broker channels, priced per engagement rather than per year. Kingsbridge does not publish a price; cover is quoted individually.

Does contract value affect the IR35 insurance premium?

Yes. Your annual contract income determines the size of the potential tax liability an insurer could face, so premiums scale with turnover. Higher day rates and longer contracts result in higher premiums.

Is IR35 insurance more expensive for public sector contractors?

Some providers apply slightly higher premiums for public sector or financial services engagements, reflecting the higher level of HMRC scrutiny in those sectors. The difference is not always significant, but it is worth checking when getting a quote.

Can I deduct IR35 insurance as a business expense?

Yes. Premiums paid through your limited company are generally treated as an allowable business expense and reduce your corporation tax liability accordingly.

What's the practical difference in outcome between the two cover types?

Legal defence cover pays for the fight; tax liability cover also pays if HMRC wins. Given that a successful HMRC challenge can produce a tax and National Insurance demand in the tens of thousands, the cost difference between the two reflects that broader scope.