Welcome to the 3rd blog in the Budget 2020 count down series.
We’re back, but today instead of saying hello, we’ll be saying goodbye to an era! Goodbye to (many) contractors.
From 6th April 2020 private companies dealing with contractors will also have to assess whether they are caught by IR35 and will take responsibility for that decision accordingly. We’ve already seen many household name organisations stating that they will not longer deal with contractors (I can’t bring myself to say ‘employ’ contractors – that is so wrong) rather than assess those they have and take the risk of future penalties.
This is not (in my opinion) a bright move. IR35 is implemented to ‘equalise’ the tax take between contractor and employee: but by killing the contractor market we also kill off some flexibility within the job market and give the end employer further legal and taxation compliance issues. National efficiency has taken a step backwards here.
Overall IR35 is a complex and contentious issue and not one I intend to go into in a lot of detail today. Those of you affected are I’m sure more than aware of your own situations.
In my next blog i’ll focus on changes to the employers national insurance allowance, and we may discover those changes are not be as helpful as they first appear.
