Private Sector IR35 reform: what will it mean for contractors?

IR35

Off-Payroll working – what is it?

Most contractors probably already have a basic understanding of IR35 legislation – HMRC’s framework to try and weed out “disguised employment” among people who are claiming to be self-employed but whose work operates along lines they deem closer to an employer-employee relationship (if you’ve never heard of it, check out our previous guide here). It’s also commonly referred to using HMRC’s terminology of “off-payroll working”.

What some may not be aware of is that IR35 regulations have already undergone reform recently in the public sector, with the changes due to be extended to the private sector from April 2020. There is a consultation open at the moment which purports to inform the Government’s implementation of the new rules, but many contractors are sceptical that their voices will be taken into account.

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Being Lorraine Kelly: IR35 status explained

IR35

HMRC’s most recent defeat by the queen of daytime TV, Lorraine Kelly, has thrust IR35 regulations in the spotlight once again. But how can contractors be assured that they won’t fall foul of HMRC’s crackdown on “disguised employment”? Much of the press coverage focused on the judgement that Kelly does not appear on television as herself, but rather performs the chatty persona “Lorraine Kelly”. Although you might not be able to get away with arguing that you perform your freelance duties as a more entertaining version of yourself, there were many other aspects of Kelly’s successful defence that can serve as useful guidance for contractors with regard to the various indicators of “genuine self-employment” as outlined in IR35 legislation. The judge for Kelly’s trial declared that they “did not consider this a borderline case” as they dismissed the £1.2million bill for tax and national insurance that had been claimed against her.

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Gotta Have IT: IT skills in demand this year

IT Skills

IT is still one of the biggest-expanding sectors in the UK economy. There are over 1.5 million jobs in the UK digital sector and 2.2 million in the wider digital economy. A recent study by recruitment body APSCo found that IT professionals were the most sought-after workers in 2018, with demand for these roles increasing 28% year-on-year. With specialist IT skills highly sought-after across a range of sectors, a good geographical spread of jobs, and digitisation and digital security becoming a priority for all types of business, it’s no wonder that so many IT professionals are choosing to become contractors and freelancers. Here we take a look at the skills that are most in demand from IT freelancers this year. If you have expertise in one of these areas, this could be the ideal time to go it alone.

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Spring Statement 2019 – The Kingsbridge View

Spring Statement 2019

In recent years, the Spring Statement and Autumn Budget have delivered a series of blows to the contracting community. From IR35 reform to the failed attempt to raise NIC payments, the Chancellor’s announcements have had many self-employed workers hiding behind the sofa.

It was with some relief, then, that other more pressing issues (see: Brexit) meant that this year’s Spring Statement seemed very likely to be a quiet one. As expected, that was the case.

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IR35 reforms for private sector – consultation released

IR35

Businesses to be responsible for sorting out status disputes, notes Larsen Howie’s new Head of Tax Andy Vessey

A little quicker off the mark than many had anticipated, HMRC have published the consultation document ‘Off-payroll working rules from April 2020‘ which will run for 85 days, closing on 28th May 2019.

Ostensibly, the off-payroll rules will mirror those currently in place for the public sector but with some tweaks. This is because the government acknowledges that the needs of private sector organisations are different to those in the public sector, and that the range of activities carried out are much more diverse.

The extension of the existing rules to cover independent contractor usage is due to begin on 6th April 2020, with the consultation making it clear that the public sector rules will serve as the starting point when the private sector rollout begins. This consultation period is intended to gather comments from stakeholders on the proposals put forward by HMRC. Here’s what you need to know.

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Self-employed make up almost 15% of UK workforce, new data shows

Self Employed

With talk of Brexit and IR35 reform dominating contracting and freelancing circles for some time now, the continued growth and success of the self-employed community is sometimes left behind.

But despite a backdrop of economic uncertainty and the unsettling influence of looming legislative reform that community has continued to thrive. Recently released data from the Office for National Statistics shows that the number of self-employed people in the UK rose by an impressive 63,000 to 4.84 million in the last quarter of 2018.

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EU settled status for contractors and freelancers

Settled Status

Amidst a still unclear Brexit picture, recently there was a piece of good news for EU citizens living in the UK. Theresa May announced that the Government would be abolishing the £65 fee for individuals to apply for settled status in the UK after Brexit. This is particularly welcome news for contractors and freelancers, as many employers were offering to cover the cost for their workers, whereas the self-employed would have to find the money from their own pockets. This blog takes a closer look at the process of applying for settled status if you are a contractor or freelancer. As we’ve seen from the past month or two, almost everything about Brexit is still up for negotiation and subject to change, but here is the advice as it currently stands.

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Brexit: What could it mean for contractors and freelancers?

Brexit

As the Brexit debate rumbles on in Parliament and the UK seems no closer to clarity on what Brexit will look like, many contractors and freelancers will be wondering about the impact that it will have on their businesses. Of course, it all depends on what kind of Brexit we end up with and the specifics of your industry. In this blog, we take a closer look at what the likely impacts of Brexit might be for contractors and freelancers and whether there are any sectors that might see benefits when the UK exits the EU.

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10 things you might not know about self-assessment

Self-Assessment

It’s that time of year again! As every contractor and freelancer knows, January is the time to get those accounts straight, file your return and pay any outstanding tax. While we’re all familiar with the nuts and bolts of the self-assessment process, we thought we’d take a closer look at the bigger picture. So here are 10 things that you might not know about self-assessment. Hopefully you’re in the 52% of people who have already filed their self-assessment with HMRC – if so you can sit back and read the rest of this blog in a self-satisfied state of calm.

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Rail trouble – tips for commuting contractors

Rail Trouble

Price hikes and poor service have seen the UK’s troubled rail transport system hitting the headlines again over the last month or two. But until we master the power of teleportation, commuting by train is a necessary evil for many contractors and freelancers who need to visit sites or meet with clients. This blog offers some tips to make commuting less expensive and more productive.

Split tickets are quite possibly our favourite “life hack” ever. A quirk of the ticketing system in the UK means that splitting your journey in half and buying two separate tickets can work out far, far cheaper than buying one ticket for the whole journey. For example, if you need to travel from Birmingham to Reading and back, splitting your ticket at Banbury can save you nearly £60. There are helpful online tools such as Trainsplit to help you find the best ticket combos for your journey. You don’t have to get off at the intermediate station, though the train you travel on does have to stop there.

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