Potential IR35 Changes in 2020 Guidance for Contractors.
You may have heard that there are some changes to the regulations that organisations must follow when engaging contractors who provide work via their own LTD Company;
What is changing?
Currently, you self-assess your IR35 status and are financially liable should your assessment be incorrect. Following the changed you may no longer be able to self-assess and your status will instead be decided by the end hirer who may decide that your role inside of IR35 and so PAYE taxes will be deducted from your contract rate.
The liability for payment you gross should your IR35 status be challenged will also be levied against the fee-payer (organisation which pays your Ltd Company bank account) meaning that your agency may not be in a position to deviate from the end hirers assessment.
What can you do?
The choice may not be your and it may just be a decision that is made by your end client and agency, however you can consider influencing your end hirer and agency by:
IR35 Status Assessment Report
Obtain and IR35 status assessment report which you can present to your agency and end hirer to demonstrate to them that you can still be engaged safely via your limited company. Cost £90-£125 plus VAT
If you pass the assessment you can ask your agency to allow us to pay you gross into your limited company as the fee payer removing them from any liability. Cost 3-5% dependent on sector.
Engage NumberMill to negotiate your status with your end hirer. Cost £290 plus VAT.
FCSA Accredited Umbrella
If your agency or end hirer insists on PAYE decutions being made, you can switch to our FCSA Accredited Umbrella. This is the best value compliant Umbrella in the marker and you may still be able to claim tax relief on business related expenses.
Be wary of non-compliant Umbrellas as they could leave you with unexpected tax bills.