IR35 this, IR35 that, it's all we've heard for the last few months and not in a good way...until now! The recent news that IR35 has been postponed is music to the ears of freelancers and freelance recruitment consultant alike, especially in these already uncertain times!
We've enjoyed years of merrily placing contractors into roles where the responsibility for IR35 determination sat with the candidate - meaning freelancers have reaped the rewards of using LTD companies
This was due to change come April where the determination would fall to the end client, and as such the tax burden if they were found to be working outside IR35 incorrectly would fall to the client. This meant most roles were being deemed as Inside IR35 which of course was nightmare news to freelancers who were facing dramatically lower take-home salaries.
So what does this change mean?
- The liability will continue to lie with the contractor as before, however, if contractors have been assessed as inside we need to be careful. If the role was assessed as inside, then it is still inside
- The thing to sadly remember is that IR35 is not cancelled but pushed back for a year
- Use this year to prepare yourself financially for when IR35 does come into place.
For the most part, this will mean contractors can continue to use their LTD companies though - a big glimmer of light in these uncertain times!
Crucially, the IR35 reforms have been pushed back and not cancelled – despite calls for the changes to be scrapped.