IR35 Summary – Interims and Clients Are Covered With Us

Have you come across Off Payroll / IR35 legislation which is due to roll out in April 2020?

If your business is Medium to Large and you hire Interim Managers or Consultants, it will affect you.

Here’s a summarised version.

Personal Service Company (PSC)  – a limited company that typically has a sole director, the interim manager / consultant, who owns most or all of the shares.

End User – the end client who receives the services from the PSC. In our market this is the Food and Drinks Manufacturers.

Fee Payer – The party who pays the PSC.

From April 2020, the end user will be responsible for determining whether the PSC works in a manner which would mean they were an employee if engaged directly. The end user will therefore need to carry out a Status Determination Statement (SDS) assessment.  This assessment needs to be carried out with “reasonable care” before the work begins and fed back to the PSC and the Agency if they are involved.

If the assessment determines they are outside IR35, it’s business as normal e.g . the PSC pays their own taxes. If it’s deemed inside of IR35 then the PAYE, Employee NI and Employer NI is due. The fee payer will be responsible for these deductions.

Any Liability will sit with the Fee payer.  For all our Contracts we, Corvin Fox, are the Fee Payer and therefore liable. If the End User (Food or Drink Manufacture) goes direct with the PSC, then the End User is liable.

We work in partnership with  one of the UK’s leading legal companies protecting business from HMRC employment status challenges.

They have been advising us on working practice and reviewing all our client and interim contacts for IR35 over the years.

This change will protect our clients when they go direct through us; now, in the past and in the future. It will also clear the industry of unprofessional agencies as well as making room for Professional Interim Managers and Consultants (PSCs).

If you have an IR35 liability concern with your current provider or you have a direct relationship with a PSC, call us on 01775 729590 and we can carry out an Independent assessment with our legal partner and give you advice regarding your current situation and steps you can take.

Regards,

Denis