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Defence Outside IR35 Contracts: Compliance and Take-Home Pay
Live market telemetry, compensation quartiles, and IR35 compliance benchmarks across the UK contract sector.
Median Daily Rate
£650/day
Interquartile Range
£450/day – £850/day
Contract Engagement Split
100% Outside IR35
Market Conditions and Compensation Trajectory
Chapter 10 determinations are the reason this the UK Defence page is filtered. For medium and large private-sector clients, the hirer must issue an SDS covering this assignment. An inside SDS puts income through PAYE, while outside IR35 means a business-to-business supply. On this filtered slice, median pay is £650/day with quartiles £450/day to £850/day; 100% of visible roles are outside IR35. Model take-home on the actual SDS, not on the job title alone. Leading sector concentration on this slice is Cybersecurity at 50%, reviewed to November 2026.
Daily Rate Quartiles and Market Benchmarks
Values combine advertised day rates, stated IR35 outcomes, and sector labels from vacancies matching this hub. Quartiles use priced roles only.
| Metric | Value | What it shows |
|---|---|---|
| Median day rate | £650/day | Mid-market advertised pay for this hub |
| 25th percentile (P25) | £450/day | Lower-quartile priced vacancies |
| 75th percentile (P75) | £850/day | Upper-quartile priced vacancies |
| Outside IR35 share | 100% | Stated limited-company / outside SDS |
| Inside IR35 share | 0% | Stated PAYE / umbrella / inside SDS |
| Undetermined IR35 | 0% | Adverts that omit a published status |
| Leading sector | Cybersecurity (50%) | Largest hiring cluster in the sample |
| Priced sample | N/A | Vacancies used for the rate corridor |
| Regional rate band | UK-wide rate parity | Location pricing context, not an SDS |
Statutory Standards and Frequently Asked Questions
Off-payroll (IR35) is the organising rule on this page. The end client, not the contractor, issues the Status Determination Statement covering the Defence engagement in the UK. An inside SDS puts income through PAYE, with employer NI and typically umbrella or in-house payroll. Outside IR35 means a business-to-business supply: the limited company invoices the fee-payer and accounts for corporation tax. Do not treat a fixed-term salary as an outside finding. CEST and working-practices evidence (control, substitution, mutuality) still matter more than the vacancy label. Do not start a Defence engagement in the UK on an assumed status.
