A recent study has found that three in five contractors may have to seek alternative work with other businesses if they are found to be inside IR35 when the intermediaries legislation moves to the private sector next year.
Barclays Bank has already told its contractors that it will no longer engage with them unless they go into PAYE by the end of February 2020, as the bank is not prepared to take any risks once the legislation requiring employers to take responsibility for checking contractors’ employment requirements takes effect in April.
This legislation is already in place in the public sector, and large businesses in the private sector that employ lots of contractors are now scared of opening themselves up to significant financial risk.
However, according to the study, if asked to go into PAYE, almost 60 per cent of contractors said they would consider seeking alternative work with another business, and 30 per cent confirmed that they would stop contracting altogether, with 14 per cent saying they would retire instead.
Meanwhile, 37 per cent said they would never consider going on-payroll, and 21 per cent said they would challenge a decision by a business that said they fell inside IR35. More than half believe that the changes to the law will deter people from becoming contractors in the future, which could lead to a talent drain for industries that rely on contractors’ skills.
One of the report’s authors said that the results mean that businesses must make IR35 assessments a priority, as the outcomes will not only impact contractors’ way of life but also have operational and financial consequences for businesses.
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Is your business prepared for the changes to off-payroll working?
Date: Tuesday 22 October 2019
Time: 8am for breakfast, with seminar from 8.30am to 10am
Venue: Hallmark Hotel Hull, Ferriby High Road, Hull, HU14 3LG
This will be a major change for many businesses to deal with, so places are set to be in high demand.
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