Ir35 2020

[Hobosapien]

You may be right but you could also be swept up as collateral damage. What is scarey is the chatter on LinkedIn at the moment showing a complete lack of understanding of IR35 and the changes to determining tax status.

Yep. You thought agents were clueless about IR35 and they're supposed to be the experts at what they do, wait until you see the HR bods dictating terms.

[smalldog]

You may be right but you could also be swept up as collateral damage. What is scarey is the chatter on LinkedIn at the moment showing a complete lack of understanding of IR35 and the changes to determining tax status.

Indeed I could and am prepared for it. Would it make me go permie?? not a chance as I said previously, its a life choice not a tax one and to me thats why a lot of people contract.

[northernladuk]

Indeed I could and am prepared for it. Would it make me go permie?? not a chance as I said previously, its a life choice not a tax one and to me thats why a lot of people contract.

Absolutely. I hope all the nay says that are posting the end of contracting threads put their money where their mouths are and bugger off to permie land asap and leave the rest to us that want to be here.

[smalldog]

Absolutely. I hope all the nay says that are posting the end of contracting threads put their money where their mouths are and bugger off to permie land asap and leave the rest to us that want to be here.

WHS!

[perplexed]

I'm thinking this could hit Public sector even further.

PS get contractors in through consultancy - engagement with private sector entity, so outside IR35 rght?

IR35 PS changes then apply to private sector, that route will therefore be hit should consultancy not be deemed small.

As others have said, it's not the end of contracting.

[simes]

I'm thinking this could hit Public sector even further.

PS get contractors in through consultancy - engagement with private sector entity, so outside IR35 rght?

IR35 PS changes then apply to private sector, that route will therefore be hit should consultancy not be deemed small.

As others have said, it's not the end of contracting.

Do people realise that the acronym PS applies to both Private Sector and Public Sector? Or am I missing some magic somewhere?

[gables]

I'm thinking this could hit Public sector even further.

PS get contractors in through consultancy - engagement with private sector entity, so outside IR35 rght?

IR35 PS changes then apply to private sector, that route will therefore be hit should consultancy not be deemed small.

As others have said, it's not the end of contracting.

Not automatically, the only difference is who determines IR35 status. If IR35 applies, it applies; I'll bet many PS ;-) contractors are not applying it to themselves.

Do people realise that the acronym PS applies to both Private Sector and Public Sector? Or am I missing some magic somewhere?

It's a good point :-)

[smalldog]

Absolutely. I hope all the nay says that are posting the end of contracting threads put their money where their mouths are and bugger off to permie land asap and leave the rest to us that want to be here.

actually the outcome of them going permie would be to shrink the available workforce maybe pushing up rates (supply/demand) off setting this whole debacle. well i can dream! :-)

[Scotslaw]

Since a large proportion of private sector contracts are sourced through agencies, this will have a significant impact on the way the agency model works.
Currently most boiler plate contracts have IR35-friendly clauses (e.g. around substitution) baked in. I believe that the reform will force agencies to make their contracts with both clients and contractor ltds more exacting.
I anticipate that day to day working models will need to tighten up as well.
I don't think fixed price contracts will immediately replace T&M ones. Clients who want flexibility and don't want to pay the big consultancy premiums, will find a way to make it work.

I have already contacted the agency I'm contracting through at the moment, to see what sort of changes they are planning to contracts and T&Cs.


But what if HMRC's IR35 ambitions don't end with private sector reform.
Consultancies do T&M work alongside fixed price projects. Most IT consulting engagements tend to be staff augmentation at a set day rate. This is a legitimate industry and a well-established business model. A single person outfit working inside IR35 is essentially the same thing on a micro scale. Will they be next in the HMRC's cross hairs?
Doing work classed as inside-IR35 could, in theory, be treated the same, whether the person doing it is an independent contractor or employed by a large consultancy. Would HMRC go after consultancy employees next, for work carried out on T&M arrangements? Make them liable for taxes on the day rate their employer charges the client for their time?
If this were to happen, this may not just drive work away from one person outfits to big consultancies, but may eventually end flexible working altogether.

[WordIsBond]

Would HMRC go after consultancy employees next, for work carried out on T&M arrangements? Make them liable for taxes on the day rate their employer charges the client for their time?

You do realise that the deemed payment under IR35 is based on what comes through to the PSC, not what the client pays the agency, right? Consultancy employees would never be liable for taxes on the amount paid to their employer. That would be like contractors being liable for taxes on the amount paid to the agency.

Not even Korbyn & Kompany would be stupid enough to do that.