IR35 – April 2020 News

If you are a contractor working in the IT industry, then I am sure you will already be aware of the way the UK Government is planning to apply the rules for off-payroll working from April 2020 in the private sector!  

Clients and contractors have been asking me many questions about what will happen in April 2020.  I have tried to answer as many as I can and with my own well-known brand of "blunt honesty".

I have heard lots of different strategies being thrown around by clients and contractors.

Clients are saying:

  • Refrain from using and end all current contract staff totally.
  • Do a case-by-case study as to whether the role falls inside or outside IR35.
  • Blanket all inside IR35.

Contractors are saying:

  • I expect a 40% rate rise to cover the NI.
  • I would like a rise to help.
  • I guess "I have to suck it up!".
  • I'm going permanent.

Barclays are saying:

In an email**  dated 30 September 2019, which Barclays sent from Barclays to its UK line managers for "awareness only" purposes.

  • "Barclays has reviewed its third-party resourcing arrangements and has decided that it will no longer engage contractors who provide their services via a personal services company, limited company or other intermediary."
  • "From 1 October 2019, Barclays will not extend the contracts of contractors who provide their services via a personal service company, limited company or other intermediary beyond February 2020."
  • "From 1 January 2020, new contracts and contract extensions will be arranged on a PAYE basis only."
The definite facts:
  • Each role "should" be done on a case-by-case evaulation. 
  • Contractors falling inside IR35 will need to be paid either PAYE or via a company offering "Off-Payroll PAYE" solutions.
  • No-one can really predict how this will affect the contract market as a whole.

** Email picture here.

** Original source:  Dave Chaplin  LinkedIn post

Posted by: Prospectus IT Recruitment