IR35: are you protected?

Over the past few months, there has been a considerable amount of press coverage on the pros and cons of this legislative change and its impact. Understandably, legitimate concerns have been aired and debated. The Government promised to review the legislation, and made a tweak to the application date (now changed to apply to payment for services supplied after 6 April 20, rather than any payment made after this date), yet all signs point to this change taking effect in just four weeks.

For months, BIE Executive has been discussing IR35 and what this means with our clients and candidates. If you are reading this, you are probably either a client or an interim worker supplying your services through a Personal Services Company (PSC) – and you might be wondering if you have done everything you should have done to be ready for 6 April 2020.

Just how prepared are clients and interim workers?

In our experience, the vast majority of interim workers are well aware of the subject and what is means for them. Some have taken the proactive step of driving negotiations with their clients, frequently with an outcome satisfactory to them. Those who have found themselves to be inside the IR35 legislation have been in the majority choosing the options of either permanent position or fixed term contract, rather than continuing to operate through their PSC.

As expected, larger clients have tended to address their obligations sooner. Some have engaged with larger accountancy firms, using bespoke tools to assess assignments, but HMRC’s own CEST tool remains a popular and easy to use solution. On the other hand, some clients have started reviewing their position later in the day, just starting to turn their attention to this now.

In all cases, we have found a three-way discussion between BIE, client and interim, to be the most efficient way of progressing the process of assessment and implementation.

Is it too late to make a start on this now?

In short, no: provided swift and decisive action is taken now. If you find yourself at the start of the process now, it’s not too late to take action and ensure compliance by the deadline. Three suggested immediate actions could be:

• Clients, get online and use the CEST tool to assess assignments. Interims, if you have not received an assessment from your client, ask for one now.
• Get informed: there is so much information online at present that in an under an hour, clients and interims can inform themselves with the basics
• Get advice: IR35 is not a straightforward area. Contact a good lawyer, make use of industry contacts, use your agency if there’s one in your supply chain.

Gordon Whyte, Executive Director at BIE said: “We are aware there has been a volume of press indicating the ‘death’ of the contractor market. As BIE is a business providing mid-senior consultants with niche technical skills, we are finding there remains a high demand from clients to bring in day rate based contingent workers. In short, while the mechanics of engagement are changing, the demand for skills has remained high through the first quarter of 2020. 6 April is only the starting point for the impact of this key change.”

If you would like any further information, please take a look at our IR35 Guide, or reach out to the BIE team.

* Nothing on this website constitutes legal advice and should not be treated as such. The contents of this site are for general information purposes only. Whilst we endeavour to ensure that the information on this site is correct, no warranty, express or implied, is given as to its accuracy and we do not accept any liability for error or omission.