After HMRC IR35 Concession Companies To Extend PSC Contractors

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HMRC IR35 Concession for Companies and Contractors
HMRC IR35 Concession for Companies and Contractors

HMRC IR35 Concession

After the HMRC IR35 concession yesterday some companies are extending their contractors who work via personal services companies.

The IR35 date of implementation changed.

Previously companies had an end of February deadline for their contractors. However, HMRC have now said that contractors can be paid via their personal services companies in April for any work done in March.

They just can’t be paid via their personal services companies for any work done in April or after that.

Contractor Questions on HMRC IR35 Concession

  1. Are contractors meekly accepting the IR35 changes?
  2. Did companies foresee the consequences when they blanket banned PSC contractors?
  3. What effect is the HMRC IR35 Concession having on contractors?
  4. Why has this HMRC IR35 concession come?
  5. Will companies lobby Government over IR35 more successfully than contractors?

Are contractors meekly accepting the IR35 changes

This will come as a big relief to many firms. We are hearing of emergency meetings at companies where the scale of the problem is now realised.

The Government and HMRC thought that contractors would take this lying down. They thought that contractors would simply accept this massive increase in tax. They thought this would be a simple tax to collect.

Did companies foresee the consequences when they blanket banned PSC contractors

Companies appeared to believe this too.

They thought that they might lose a few contractors but that the vast majority of contractors would simply take the hit and continue as normal with their morale still high.

One respondent yesterday, after our article on it, said that it would not make any difference as companies already have their contractors crossing over or leaving at the end of February.

What effect is the HMRC IR35 Concession having on contractors

However, I’ve heard from contractors at three different companies that memos have gone round saying that contractors who are supposed to be departing at the end of February can remain contracting at the company until April 6th.

Presumably it will be the same for those deciding to go the PAYE route rather than leave.

Why has this HMRC IR35 concession come

This HMRC IR35 concession has come because of pressure from companies.

Could this delay be just the first and is it possible that pressure from companies could delay the IR35 implementation till next year?

That’s still not very likely but more likely than it was yesterday.

Will companies lobby Government over IR35 more successfully than contractors

However, the complete farce of company after company banning the use of personal services companies by contractors is now causing massive disruption at almost all of our major companies.

Contractors were never able to lobby various Governments successfully.

Will our major companies do any better as they see the total mess this is creating?

Could this HMRC IR35 concession be just the first as our biggest companies flex heir muscles?

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Comments

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2 COMMENTS

  1. Currently the government and the organisations are making IR35 problem of contractors and contractors alone.
    Every single contractor should down tools and walk out, for zero pay (I get it) for whole of March and see what’s the impact on organisations, their initiatives, the economy and the government’s IR35. We should not be scared and should empower ourselves and take this fight to HMRC.
    It’s ludicrous that we are being treated as full time employees with zero benefits… and work through umbrella companies where all our payments will be held. If they go down, we won’t see a penny and will have to spend more time filling out FSCS forms (provided the umbrella company is registered!).

    Unhappy long term contractor.

  2. The issue is not the increase in tax I’m more than happy to comply. It is more a mix of blanket bans being unfair. Cap on travel expenses preventing you from contracting out with a daily commute from your home. Lack of information or information too late from HMRC.

    The cap on travel is the worst part as job availability and ability to remain in contract has been taken away from us. The impact this alone will have on contractors and the other businesses we use such as transportation and hospitality is epic. This will result in a major loss of business for those sectors this creating mass redundancies of full time staff. Creating a bigger loss of jobs across the country.

    Look at what it done to the NHS almost 40k consultants have left for the EU or went to 3 day work weeks.

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