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IR35 legislation changes are coming in April. Are you ready?

Chris Pont

The Government announced planned changes to IR35 legislation back in July 2019. Changes to the “off-payroll” working rules will see the responsibility for setting IR35 status passed from contractors to the medium and large private sector companies that engage these workers. The intention of the changes is to ensure that two people working side by side in a similar role for the same employer pay the same employment taxes.

It’s clear that changes to the IR35 legislation from April 2020 are leading many organisations to review their use of limited company contractors. Many organisations are ceasing to engage new limited company contractors due to the exposure this gives them. However, there is still a need and pressure to deliver projects and on time and on budget.

Whilst contract resource can provide flexibility and drop-in knowledge on a specific area, historically it’s often been used for the wrong reasons. With changes to how IR35 is being enforced by HMRC, some businesses are changing their approach, leaving gaps in how software is delivered.

Who will be affected by changes to IR35 legislation?

According to Government guidance the rules apply to all public sector clients and private sector companies that meet 2 or more of the following conditions:

  • you have an annual turnover of more than £10.2 million
  • you have a balance sheet total of more than £5.1 million
  • you have more than 50 employees

How can projects stay on track without employing additional permanent staff?

IT contractors have formed a significant part of the workforce in many large organisations but the impending changes will put significant pressure on those organisations to move away from this employment model.

IJYI have therefore developed Delivery-Team-as-a-Service to support this critical business challenge. Our delivery capability and service goes beyond traditional software delivery, focusing on quality throughout the life cycle with a pragmatic use of the latest technologies, tools and frameworks keeping us at the forefront of software engineering.

In addition our service allows you to adjust the skills you use based on dynamic requirements. This coupled with our existing understanding of your business could help to alleviate this risk and support the delivery of your development road map.

Contact Us for an initial discussion on how we can help you to manage this challenge.