IR35 Soft Landing Ending – Industry Trends: Part 7
Since the changes in the Public Sector in 2017 and the subsequent change to the Private Sector in 2021, blanket approaches to IR35 have been common.
Implementing either a blanket ban on contractors working via a Limited Company or assessing all or large populations of contractors as ‘Inside’ IR35 is fraught with issues:
- This goes against the advice from HMRC and they clearly state this will not constitute Reasonable Care in the legislation, leaving you open to investigation and claims from workers for unlawful deductions of earnings
- Increased rates of pay and project delays! In our recent survey over 50% of businesses were concerned regarding these issues due to poor management of IR35
- And over 90% of businesses had increased contractors’ rates of pay since the change to IR35
- Talent attraction – having a robust IR35 process can help you attract contractors and in addition, the most highly skilled as they will prefer to work ‘Outside’ of IR35
- Contractors challenging the decision can be a time consuming and expensive exercise and a blanket approach is more likely to result in challenges
- Some businesses have suffered reputational damage due to their blanket approach and certainly within the contracting community making it difficult to attract talent and keep projects on track
A blanket approach may seem like the easy option but is highly likely to be the most expensive due to project delays, increased cost and talent attrition. A simple robust IR35 solution removes all of these risks!
For any business that is concerned with what they have read so far get in touch, as we would be happy to offer our expertise along with a selection of free IR35 reviews to test your process.