If you haven't already, firstly you need to review and audit your workforce. To complete your audit you should capture and record the data to identify information such as:
To make life easier we have created a template that will help you quickly and easily complete your audit, to download a copy please contact our IR35 Team.
Once the full audit is completed, you must correctly define the IR35 status of their entire contractor population to mitigate risk. Defining the IR35 status of your contingent workforce requires a full review and effective individual assessments of each role to prevent being in breach of deploying ‘reasonable care’ when making such decisions.
Our flow chart below should help in preparing for the upcoming changes to IR35 legislation reform, including what to action and when. To ensure that you are compliant and operations don’t become effected we urge you to act now.
Assess whether your business will be exempt from the off-payroll rules or not. Tell your agencies as early as possible if you are exempt or not. If you are close to the thresholds, keep your status under review.
Assess which contractors might be affected by the changes and why.
Identify who within your business can make IR35 status decisions and ensure that those individuals understand how to assess status and have the appropriate tools to do so. Consider if you need to engage a well-established external reviewer to help with your IR35 status decisions.
Periodically review your status decisions and tell agencies immediately if you decide to change an earlier status decision.
Put processes in place to pass the status decision and the reasons for that decision to the contractor and the agency.
Work with agencies who will have their own processes in place to implement.
Agree with agencies how the increased employer costs will be met - agencies will not be able to simply absorb these costs and pay contractors the same rates.
As the responsibility for defining IR35 status switches from the individual contractor to you, the end client, businesses not only face significant financial penalties should the incorrect steps be implemented but also must be mindful of Legal, operational and reputational risk.
Being mindful for example that your non-pay rolled workforce may also be concerned by this change, and ensuring you engage with this important group will be key to ensuring you retain your supply of talent.
The good news is there is still time, we are able to support you. And, in our view, this change is not as ‘cataclysmic’ as some might suggest.
Client Solutions IR35
If you are looking for expertise to help you remove the risk of compliance or to engage project teams under a statement of work to remove the risk entirely, get in touch.
If you would like to talk to one of our experts, please get in touch using the form. If you'd prefer to talk to us right away, call us on 01785 339 000.