For recruitment agencies across the UK, IR35 is now very much at the forefront of their 2021 planning. With a number of delays to reforms for the private sector, including the postponement of reforms in April of this year due to the COVID-19 pandemic, it looks certain that these changes will come into force from April 2021.
With businesses across the UK already contending with the challenges that the pandemic has presented, preparing for IR35 is likely to be an inconvenient but necessary task.
Many businesses who had operated under the impression that it would come into force in April 2020 may have already begun preparations, but for those who haven’t, here are some of our top tips:
An early start to preparations is key to ensure you have everything in place and any issues smoothed out before changes come into force. With changes on the horizon for a number of years now, despite some false starts, it is unlikely that inadequate time could be used as an excuse for non-compliance.
Understand the legislation
For recruiters, this legislation will be entirely new as previously, contractors would determine their own IR35 status. As a result, understanding the background on IR35, why it was introduced and why these changes are being implemented in the first place will ensure that you are prepared for any questions you may receive from either contractors or clients.
Learn from past mistakes
Reforms for the public sector took place in 2017 and caused a number of issues for all parties involved. One of the main issues was that companies were unprepared and therefore unable to accurately determine the correct status of contractors. This led to blanket assessments, tribunals and significant criticism of the government’s approach.
Some changes have since been made in response to the issues, but despite this we highly recommend that you learn from past mistakes and ensure that you build your knowledge of the legislation beforehand and implement it appropriately into your existing business operations.
This time round, the government has endeavoured to provide companies with appropriate guidance that can be reviewed when implementing changes to procedures. Some of this guidance can be found here.
Ask the experts
Despite the government’s promise of guidance, there will inevitably be aspects to IR35 legislation that you are unsure of and therefore we highly recommend that you seek expert advice. This will ensure that you have the right tools to navigate IR35 reform and correctly implement the changes that will ensure compliance.
Speak to our team here at Exchequer Solutions for more information on how we can support you with IR35.