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At Qdos, we are proud to have recently engaged our 200th client as we continue working with recruitment agencies and hiring organisations to help them navigate changes to the Off-payroll working rules.
As a result of reform to the IR35 legislation in the private sector, medium and large businesses that engage contractors will become responsible on 6th April for determining the tax status of independent workers.
From April, the IR35 liability will also transfer from the contractor to the party in the supply chain that handles payments to the worker. This often leaves the recruiter exposed to the risk when placing and paying contractors even though the agency will not technically make the IR35 decision.
Given the controversy surrounding the changes and the problems experienced in the public sector following similar reform in 2017, Qdos is working hard to make sure hundreds of private sector firms will be ready for the introduction of reform.
In this article, we’ll explain how we’re helping tens of thousands of contractors have their IR35 status assessed fairly and minimising the risk and administrative burden that these changes present to agencies and hiring organisations.
A risk-averse approach to IR35 reform will see companies lose out on the skills, flexibility and savings enjoyed when legitimately engaging a contractor outside IR35. By avoiding knee-jerk and panicked decisions, such as insisting that all contractors must go PAYE, the private sector – much like the public sector – will be able to cope with changes.
We consult our clients and work alongside them to develop an IR35 plan that suits their business requirements. We train internal teams and help them deliver their strategy on an ongoing basis.
For many reasons, CEST is not fit for purpose. It ignores key aspects of the IR35 legislation that a contractor’s status can hinge on, fails to take into account details unique to a working engagement and, crucially, has been dismissed in court more than once. We therefore strongly recommend that businesses do not rely on it when assisting with or determining a contractor’s status.
To ensure IR35 compliance, Qdos provides independent IR35 status reviews, which offer a thorough objective, and expert assessment of a contractor’s tax position. We conduct, on average, 2000 of these every month.
In 2019, Qdos research revealed 92% of contractors had not been contacted by either their agency or client about IR35 reform. As 6th April approaches, it’s vital that firms readying themselves for changes communicate with contractors and any other parties in the supply chain.
As part of our IR35 advisory services, we are stressing the importance of collaboration and joined-up thinking with regards to making IR35 assessments.
Fee-paying agencies and businesses that pay contractors directly are understandably concerned about carrying the IR35 liability. In the public sector, it has led to risk-averse IR35 determinations, while in the private sector, reports continue to surface that financial services companies will follow suit.
To ensure companies can legitimately place and engage contractors outside the legislation, Qdos offers IR35 insurance to protect the party that carries the liability. The combination of an independent IR35 status review supported by insurance maximises accuracy and minimises risk.
IR35 is a complex tax legislation and many businesses do not know where to start when it comes to preparing for reform. Our team of IR35 experts are assessing how ready businesses are for these changes. We stand back, look at the bigger picture and explain what needs to be done to help a company attract contractors and ensure compliance.
With just months to go until IR35 changes are rolled out, it’s vital that organisations are prepared for their arrival. In the lead up to reform and after its implementation, Qdos will continue to represent the best interests of contractors and the businesses that place and engage these workers.
Ask away! One of our team will get back to you!