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Employment Status/IR35 issues

IR35 reforms commenced in April 2021 after a 12 month reprieve due to Covid-19. Engagers now have to assess the employment status of their off-payroll workers and issue Status Determination Statements (SDSs) to them and the agency that pays them. If found to be caught “inside IR35” the off-payroll worker will require to have PAYE & NIC deducted from their presented invoices. If it transpires that the SDS was made without taking reasonable care, HMRC can penalise the engager. To mitigate this risk some larger employers have taken the drastic step of insisting that all of their contractors go onto PAYE. As well as being very expensive, we know that this is the incorrect methodology to IR35 reforms.

To assist engagers HMRC have recently updated their Check of Employment Status Tool and engagers are recommended to use CEST to arrive at their SDSs. This is because HMRC have promised to stand by the CEST derived SDS ruling as long as accurate data is enterted into the tool.

To maximise your chances of obtaining an “outside IR35” ruling from CEST you need to firstly get your contracts for services reviewed by our consultants. We can bolster your contracts by adding & updating crucial new clauses that will reinforce the self- employed nature of the engagement. Coupled with this, our consultants can review your current working practices and offer advice on what changes you should consider making to facilitate the maximum number of outside IR35 rulings possible for your business.

All of the above solutions have been specifically designed to fully meet the requirements of businesses by experienced employment tax consultants.
Please do not hesitate to contact us below to find out more about our affordable IR35 services.

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