What are the IR35 off-payroll changes implications?
IR35 is the word commonly used to describe UK tax legislation aimed at preventing tax avoidance by intermediary workers, mainly Limited Companies. These off-payroll working rules targets those Personal Service Companies who the government believes are wrongly disguising their work as business transactions to avoid paying the appropriate income tax and national insurance that would be owed if they were an employee of the end client.
IR35 has been in force since the year 2000. in April 2021, the off-payroll changes come into effect in the private sector, bringing it in line with the public sector which experienced a similar legislation change in 2017.
Up until 2017 in the public sector, and April 2021 in the private sector, the responsibility for determining the IR35 status and any tax liability lied with the PSC (contractor). From April 2021, in the private sector, Status Determination will be the responsibility of the End Hirer (client) and tax responsibility will be with the Fee Payer (often the Recruitment Agency).
Should it be proved that the End Hirer has not taken “Reasonable Care” in coming to this Status Determination, any tax liability would pass from the Fee Payer (often the Recruitment Agency) to the End Hirer. It is therefore essential that you choose a credible compliance solution that allows you to meet this criteria and reduce your risk of retrospective tax liability.
Choosing a credible compliance solution
To ensure that an IR35 status is set correctly, you should appoint an expert to assist you. As well as offering contract and permanent recruitment services, Corecom Consulting offers a fully insured compliance product, its services and education, free of charge. We’re passionate about hiring the best IT talent but also making sure we, our clients and our contractors are ahead of the curve in legislative compliance.
Corecom IR35 Connect is our comprehensive compliance solution for contractor hiring businesses. It consists of three key, connected services that insures your business against any potential tax liability, reduces contractor management and administration and limits the strain of contractor cash flow:
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IR35 Protect
A fully insured, client facing, online platform for Status Determinations protecting all parties in the supply chain.
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Corecom Projects
A project/product solution, based on deliverables and milestones, wrapped up in a single Statement of Work managed by a Technical Engagement Manager for your contractor recruitment.
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Corecom Payroll Outsourcing
The option to outsource the payroll of your direct contractors, removing your “Fee-payer” tax liability and improving your business’ cash flow.
Book your demo
Don’t just take our word for it – book a demo today to discuss your specific requirements. We’ll show you how easy it is to use our online platform for your Status Determination Statements.
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