IR35 Articles

Contractor productivity worth £5,000 per employee

A new report into contractor productivity has found that firms with at least 11% of their workforce as contractors are more productive, with each employee generating an extra £4,669 for their organisation on average.

Researchers from the Trinity Business School and the University of Derby said the results showed the important role that contractors can play in the UK’s recovery.

Government’s Meek Response to Lords IR35 Report
marketing | 16 July 2020
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HMRC and the Treasury have published a weak response to a damning House of Lords committee report on off-payroll (IR35) working rules. 

Industry commentators said that while the response acknowledged many of the issues facing limited company contractors, they failed to propose any proactive solutions. 

IR35 Rule Change Set for 2021

Controversial changes to off-payroll working (IR35) rules are set to come into force in April 2021, after MPs ignored a call to delay the changes until 2023.

Changes to the way IR35 rules are applied in the private sector were originally penned to take effect in April 2020, before pandemic-related uncertainty forced a stay of execution from lawmakers.

 HMRC Publishes Information about its IR35 CEST Tool
marketing | 24 March 2020
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HMRC’s Check Employment Status for Tax (CEST) tool has been a touchy subject for contractors that want to find out if they will be inside or outside IR35. 

The online tool was first introduced in 2017 to help contractors and their engagers judge employment status for tax purposes and, ultimately, how a contractor will be taxed.

The service asks a series of questions based on key legal criteria. It helps provide a judgement in most straightforward cases, with assistance in more complex cases available through a handbook and the HMRC call centre.

Bittersweet Budget for Struggling Contractors

Contractors praying for a delay to IR35 changes in the private sector will be disappointed by the Chancellor’s budget statement yesterday, but there were several positives that we can take away as well.

 

Survey: Lockdown and IR35 Affecting Contractor Wellbeing
marketing | 7 August 2020
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IR35 concerns and the coronavirus lockdown has had a negative impact on UK contractor wellbeing and finances, a survey has found.

The survey of over 1,000 limited company contractors found that many were disappointed to be excluded from government support schemes like the self-employed income support and furlough schemes.

How do umbrella companies avoid IR35?

Umbrella companies allow contractors to achieve IR35 compliance. If a limited company contract is deemed ‘inside IR35’, contracting through an umbrella company is usually preferable.

This will become more important as an upcoming rule change will mean that many more contractors are caught out by IR35 legislation.

Government must address IR35 flaws, say Lords
marketing | 30 April 2020
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A House of Lord committee has concluded that the government needs to address a raft of unfair flaws in the IR35 system, before new rules are implemented in the private sector.

Lords on the Economic Affairs Finance Bill Sub-Committee found that IR35, which is supposed to tackle tax avoidance by people in ‘disguised employment’, has not worked properly since it was introduced 20 years ago.

IR35 Reforms Delayed for One Year
marketing | 18 March 2020
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The government has announced that changes to IR35 rules in the private sector will be pushed back by one year, due to disruption caused by the coronavirus.

 

IR35 Contractors: Act Fast to Avoid Wind-Up Tax

Limited company contractor that are caught under IR35 arrangements may need to act quickly if they want to close their companies and make the most of lucrative tax incentives.

If they wish to continue working flexibly, these contractors will also need to think carefully about how they offer their services, according to  Umbrella.co.uk Director Miles Grady.

“Because we offer limited company support, umbrella payment solutions and a business liquidation service, we are in the best position to help a growing group of customers that have been caught out by IR35,” Miles Grady said.

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