If you have assignments in the private sector, then the imminent IR35 reform is going to impact you. But, along with exploring the options available to you, it’s also worth looking into how you can prepare ahead of time.
Join us as we detail the ways you can…
Act now
First and foremost, make sure something is being done. If your client, or whoever is the fee-payer (such as a recruitment agency), hasn’t yet discussed the changes in legislation with you, contact them instead.
Get them to clarify what they’re doing in response to the reform. Will they be reviewing cases individually? Or are they using blanket IR35 assessments? By knowing how your client and agency are going to react, you will be in a better to position to decide whether or not you want to carry on working on that contract post-April.
It’s also a good idea to speak to other contractors who are carrying out work for the same client to see whether they’ve had any discussions about IR35. If not, then consider speaking to your client collectively to ensure they not only act but in the right way.
Get confirmation
Once you’ve spoken to the end client or fee-payer, you should try to get written confirmation of the fact that your IR35 status has been discussed by all within the supply chain, and that you’re also all in agreement. This should come in the form of a Confirmation of Arrangements (CoA) document and be signed by the end client.
However, this isn’t a legal requirement, and so it could potentially be difficult because following the reform, it will be the end client who is held accountable for your status. If you do manage to acquire it though, then it would be a challenge for them to then amend it (unless they have a valid reason).
In the situation you can’t get this, you should know that by law they should provide you with an IR35 Status Determination Statement (SDS), which affirms your status, and the rationale behind it.
Know the tests
To be classed as ‘outside IR35’, you’ll need to pass a number of status tests. The main factors are ‘Substitution’, ‘Control’ and ‘Mutuality of Obligation (MoO). They should all be considered, because one factor on its own may not deem you inside or outside of IR35.
Substitution
This is perhaps the most important one – it’s the focus of investigations. Look at your contract, and whether or not you have the right to offer a substitute worker. If you opt to exercise this, it’ll work to support you being ‘inside IR35’.
Control
With this factor, you’ll be required to demonstrate that you’re not under any direct control of the end client.
MoO
If your assignment is to fall outside of IR35, you would need to verify that there’s no mutual obligation for the end client to supply you with paid work, or for you to accept it.
Prove you’re a legitimate business
To further validate your IR35 status, you should look at whether you’re acting like you’re running a business too. To be considered as outside, you should have the likes of business insurance and a separate registered office address to the client, at the very least.
Consider your marketing as well. A website and materials such as stationary will show that you’re a legitimate business – specifically branded invoices and letterheads.
Seek help from the experts
It’s also worth speaking to IR35 specialists (that’s where we come in). Whilst this guidance will help, it might be that your contract hasn’t been assessed correctly. We will be able to review it– without bias, and accurately too.
We’ve partnered with insurance specialists Kingsbridge and Larsen Howie to provide you such a solution. We collaborate to give you a truthful SDS. And if you’re found to not be caught by the legislation, then we can indemnify the client against this decision. The result is that there’s less, or even zero risk to them, alleviating their worry.
To take advantage of this solution, as well as discover the options available to you, get in touch with the friendly team here at Bright Ideas Accountancy. Simply call us on 0161 669 4221, email info@biaccountancy.com, or complete our online contact form.
