Under the IR35 changes that came in 2017 and 2021, the recruitment agency is often referred to as the ‘fee payer’ as they are usually the entity closest to the contractor in the supply chain, thus making them responsible for deducting the correct TAX/ NIC from the contractor.
The fee payer won’t be responsible for IR35 but will be required to complete additional tasks:
Ensure contractor is paid correctly: If a role is determined inside IR35, it’s the fee payer’s responsibility to make the correct PAYE deductions. Getting this wrong can lead to fines and penalties.
Even though the fee payer is not responsible for making the IR35 determination, they need to ensure they are happy with the assessment that’s made. This is in the interest of them and the contractor as it ensures the contractor is not subject to unnecessary tax deductions/is not paying enough tax. If the fee payer disagrees with the hirer’s SDS they can submit a challenge in the same way the contractor can.
Many recruiters will not have the required expertise to meet their fee payer requirements or have sufficient payment models available. Therefore, finding the right partner is paramount for everyone in the supply chain.
With a wealth of knowledge and dedicated IR35 experts, Brookson is on hand to ensure recruiters comply with HMRC’S requirements and take the burden away from their agency.
We will become part of your supply chain and remove the fee payer liability.
Complete compliance checks against all intermediaries and protect agency directors against the criminal finance act.
Centralise and streamline all payments through Brookson.
Written by our experts, these guides will give you the tools to understand the implications of IR35 as a contractor, recruiter or hirer.
Brookson Legal Services is an SRA regulated law firm that focuses on IR35
Experience, Expertise and Credibility
We are a law firm, regulated by the Solicitors Regulation Authority, who have been advising on IR35 since its introduction in April 2000. We have team members who have sat on HMRC’s IR35 Forum and we are often instructed to act for clients who are subject to an IR35 enquiry by HMRC.
Our Relationship with Agencies
As well as being a regulated law firm, Brookson Legal is part of the wider Brookson Group of companies which has built a very successful business providing professional advice to self-employed contractors, many of whom have been introduced to us by agencies. Our relationships with agencies are hugely important to us and therefore Brookson has a dedicated Agency Support team working just for you.