From 6th April 2021, the new IR35 rules will come into effect. Whilst the determination to switch contract worker status is made by the end-client, recruitment agencies will need to play their part.
What is the impact of IR35 on you and your contractors?
For the businesses caught by the new legislation, any contract workers that you supply will likely be asked to change to employed PAYE status, and stop being self-employed. This means that the payee of the worker will have to pay Employer’s National Insurance (based on 13.8%) and the worker will be subject to higher income tax and NI.
What can be done to mitigate the changes?
Futurelink Group offer a PAYE Hybrid payment solution that deducts tax and NI in line with PAYE whilst using any out-of-pocket expenses the worker has to reduce their tax liabilities. It can greatly improve their take home pay compared to standard PAYE, and from your client’s point of view, reduces employment costs and improves your margins.
Better still, there is no cost to the business as the worker is charged a small management fee, which is also tax deductible.
If you want to know more about Futurelink Group’s fully compliant payment solutions, please visit www.futurelinkgroup.co.uk/ir35-hub/, call 01923 277900 or email [email protected].
