Recruiters: don’t let lockdown stall IR35 plans
Staffing companies are being urged to forge ahead with IR35 preparations during lockdown, in anticipation that the new off-payroll working rules will be introduced as planned next April.
Specialist contractor insurance broker Kingsbridge has raised concerns that England’s second lockdown may impact preparations in the private sector.
Andy Vessey, Head of Tax at Kingsbridge, says while the lockdown has certainly raised a number of concerns for staffing agencies, there are several ‘business as usual’ activities that need to be maintained – and preparations for IR35 reforms are a priority.
“While the next few months are likely to continue to be filled with uncertainty, we’re confident that there will be no further delay to these off-payroll measures,” he says. “Interestingly, HMRC spoke about a ‘soft landing’ in a recent webinar, further re-enforcing that they will be going ahead with the intended changes. This ‘light-touch approach’ means that HMRC will not require the fee-payer to settle penalties for inaccuracies relating to the off-payroll working rules in the first 12 months unless there is evidence of deliberate non-compliance. However, this should not be taken as an excuse to avoid making sure you have an accurate, fair process in place ready for next year but should rather spur you on to make sure you can prove your compliance accordingly.”
Recruitment firms need to work with end-hirers and contractors now to ensure determinations are being made in a fair and accurate way, as this will be crucial to success once IR35 comes into effect on April 6. “Keeping the momentum going on preparations, despite the challenges we’re all facing in light of Covid-19, is important if recruiters, employers, and contractors are to be in the best possible position next year as we attempt to recover from what has been a highly unprecedented 2020,” Vessey adds.