The government has now released further detail about the reform of IR35 in the Private Sector, which means we know a little more about where responsibility will lie after April 2021. In this article, we’ll explain who the various parties are and what their responsibilities will be.
As most UK contractors will be aware by now, the much talked-about private-sector IR35 reform is due to take place in April 2021, and will mean that contractors will no longer be responsible for determining their own IR35 status. This responsibility will pass instead to their end client, so anyone who engages contractors, unless they class as a small private company, will have to assess whether those contractors fall inside or outside IR35.
Whilst the changes to IR35 have been delayed until April 2021, you may find that your end client continues with their plans to cease engagement with limited company contractors outside IR35. If this is the case you will need to choose a PAYE solution. How much choice you have may depend on the agency and client, but for most contractors in this situation employment with an umbrella company is by far the best of the options available. In this article we’ll break down the advantages that umbrella has over the other possibilities.
In the run-up to the reform of the private-sector off-payroll rules, we have seen more and more end clients taking control of how they engage with contractors. In future, deliberate policy decisions about contactor engagements are likely to be the norm, as end clients act to manage the work and risks associated with engaging contractors, whether inside or outside IR35. This is likely to continue, despite the dealy to the change, now due in April 2021.
Following the reform of the off-payroll rules, which is now due to take place in April 2021, your end client will have to determine your IR35 status, unless they class as a small private company.
