Currently, the responsibility of who determines the IR35 status of a contract usually lies with the contractor, in most cases. However, from April 2021, this responsibility will shift away from the contractor and on to the agency, or end-hirer.
Unless the end-hirer is considered ‘small’, they will need to conduct a IR35 assessment and provide this to your agency, if there is one involved. This IR35 assessment will consider whether the current contract is ‘inside’ or ‘outside’ IR35. The actual rules around how to determine the assessment will not change, however since your agency or end-hirer will now be responsible for any unpaid tax on a wrong determination, it could be likely they will edge on the side of caution.
How will this affect you?
The changes to IR35 could affect you significantly. Agencies and end-hirers will now be required to review all active and new contracts to determine their IR35 status. This may see them taking a different view altogether and contracts that you determined to be ‘outside’ are now changed to ‘inside’.
As a result, it is likely that end-hirers or agencies will take the view that reviewing their contractor base is too complicated and time-consuming and may simply determine that all contracts to be deemed ‘inside’. In some cases, they will simply refuse to work with limited company and only allow Umbrella workers.
We have 15 years of experience in the contractor market and have IR35 in-house experts to help guide you through the process. Whether you can continue to work compliantly through your limited company or use our new FLEX switching solution will be able to help you through the changes.
GET YOUR OPTIONS ASSESSED
Don’t delay in ensuring you understand your options. Whether your contract is due for renewal before or after April 2021 knowing what might happen and how this affects you will keep you one step ahead.
FLEX: SWITCHING SOLUTION
Whatever your future status under IR35, get peace of mind now, knowing that our FLEX solution, included in all our packages, allows you to switch between limited company and Umbrella whenever you like.
What should you do now?
Getting prepared early for April 2021 is essential to ensure you, your agency and end-hirer are ready in plenty of time. Don’t wait until it’s too late.
If your agency, or end-hirer hasn’t been in touch regarding the changes, ensure you start a conversation with them about what they intend to do.
We can help provide an assessment of your IR35 status using our IR35 assessment tool.
Please contact us to see how an assessment might help you.
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IR35 news and articles
Selected articles from our blog regarding IR35 and the upcoming changes due in April 2021.
The legislation will now be reintroduced in April 2021. This is a welcome decision in light of the worrying health and economic challenges we now face, but we must stress that it has been made clear that this is only a delay and not a cancellation.
If you’re affected by IR35 changes and need to switch to Umbrella, we can help.
Our new PSC/Umbrella package means you can enjoy the best of both worlds, toggling between limited company and Umbrella working, where appropriate. What’s more, our Umbrella is free to use when we look after your PSC accounts. It’s a great way to keep your options open.
If you are a contractor working on an assignment which is considered to be outside IR35 now, you may find this is no longer the case when the new IR35 rules come into force in April. This is no reason to panic, but it is important to weigh up your options.
Although we are waiting for the new government to give us clarity on whether the off-payroll reforms will come into effect from 6thApril 2020, it is important to understand what things need to be considered when the decision is confirmed.
English TV presenter and journalist Helen Fospero, has become the ninth broadcaster to claim victory over HMRC at the first tier tribunal.
Christa Ackroyd Media Limited v The Commissioners for Her Majesty’s Revenue and Customs – Round 2 – An example of how NOT to operate outside of IR35
One year and seven months after we considered ‘Why was Ms Christa Ackroyd deemed inside of IR35?’ by the First Tier Tribunal, we now look at the decision of the Upper Tribunal, on appeal by Christa Ackroyd Media...
IR35 Watch – Results of the Government’s formal consultation on proposed changes to off-payroll in the private sector and industry responses.
A month on from the end of the Government’s formal consultation on proposed changes to off-payroll in the private sector, and its time to consider the proposed changes, how these will affect you as a Limited Company...
IR35 Update - March 2020 The off-payroll reforms to IR35 in the private sector have now been delayed by 12 months due to the coronavirus pandemic. The legislation will now be reintroduced in April 2021. This is a...
HMRC's IR35 Business Entity Tests (BET), used to supposedly identify whether given contract engagements were at risk of being caught by IR35 or not, is to be withdrawn. The test was introduced in 2012 and comprises a...