Important information regarding IR35
The Government and HMRC are implementing changes to the IR35 legislation. In 2017, this came into effect for those working for the NHS and other public bodies. However, as of 6 April 2020, this legislation is being introduced into the private sector, too.
Accordingly, this will impact candidates working via PSCs/limited companies whose roles fall inside of IR35. When the legislation comes into force, these workers will be required to have tax and National Insurance Contributions (NIC) deducted from their income at source.
As the end-client, you are responsible for determining the status of your off-payroll workers and informing us, the agency, of your determination.
If you have any questions regarding IR35 or would like some support, please don't hesitate to email us at IR35@ukics.com.
IR35 is a set of tax laws which are designed to ensure all workers are paying the correct amount of tax and National Insurance Contributions (NIC). There are a series of tests used to determine the tax status of contractors working through personal service companies (PSCs).
IR35 is not a new set of tax laws. The changes due to affect the private sector come the 6 April are already in place in the public sector and have been since April 2017.
As of 6 April 2020, companies in the private sector will be responsible for determining the IR35 status of workers.
We need clarification from each of our end-clients. For each person we place into each new booking, we will need to clarify the IR35 status of that worker. The only exception will be if we have a pre-determined classification from the organisation (e.g. they are classed as a “small business” and are therefore exempt from the legislation changes).
A small business is established when an organisation meets at least 2 of the following criteria:
- Turnover of <£10.2m
- Balance sheet of <£5.1m
- Fewer than 50 employees
The organisation’s Purchasing, Hospital, Medical, Finance Directors/Managers should be able to supply this information, so we would encourage that these avenues are investigated at first point of contact. Should you be unable to locate a suitable person/team, please let us know and we will do our best to help.
You can complete the employment status tool by following this link.
Alternatively, if the organisation is classed as a “small business”, then immediately they are exempt from the legislation changes.
We will provide you with our reasoning as to why we think the decision should be reconsidered, based on knowledge/information received. Ultimately, the decision will be with you/the end client.