Just because government are unable to sort out Brexit, this does not mean that IR35 scheduled in for April 2020 is going to be delayed. Regardless of Brexit, a General Election and possible leader change, IR35 will still be in place and actioned. There has been much mentioned recently that with a General Election and possible change in government IR35 will be shelved. This is not going to happen, according to a representative from Saffrey Champness, one of the UK’s Top 20 accountancy firms.
With Public sector already well into its second year of change the Private Sector was always going to be targeted and after a year of delay it is now finally coming into play.
HMRC view that one third of all PSC’s should operate within IR35 yet currently only 3% actually do. With £1.3bn tax loss in the Private Sector there was always going to be dramatic changes to secure this loss and to recoup as much as possible moving forward and IR35 changes will be the catalyst for this.
With April just around the corner and with many workers still not taking action, this is only going to cause more disruption come the deadline.
Long-term assignments that fall over the deadline need to be addressed as circumstances may very well change if that worker is found to be inside of IR35 and a change in pay is required. The CEST tool is still the best option to see how your role fits into these changes. Utilise this tool and when completed and you fall outside of IR35 then print off the result and make sure it is dated. HMRC will stand by the decision when CEST is used provided you can “hand on heart” confirm that all answers are correct. Answering just to get the result you want will not stand up and you will inevitably get found out and then pay the price.
There are a number of options for contracted and limited company workers. If they are inside of IR35 according to the end client or the CEST tool then they can go via PAYE or a provider like ePayMe. They can keep their Limited Company dormant should work come about that has them fall outside of IR35.
The whole reason for these changes is the £1.3bn HMRC are looking to secure back into the treasury, it is not a vendetta against contracted/limited workers like some seem to believe.
Work to the rules and guidelines and all will be fine, try and swerve them and look for alternatives could end up costing far more in the long run.
If you have any questions surrounding your role and whether you need to make changes then do get in touch with ourselves or HMRC we are both here to help make life a little smoother when it comes to your earnings.
ePayMe – 01252 863 700
HMRC – 0300 200 3300 employees helpline