IR35 Contractor Market Chaos
There will be devastation at the IR35 contractor market chaos that will ensue after April 2020 when the IR35 reforms in the private sector will come into effect. This is according to a new survey of its member from contractors group IPSE.
Questions on IR35 Contractor Market Chaos
- How many contractors are going to quit contracting?
- Has the Government IR35 gamble succeeded or failed?
- What did our big companies think contractors would do?
- What will contractors do about the IR35 contractor market chaos?
- How will some of the UK’s big companies lose doubly when contractors depart?
How many contractors are going to quit contracting
According to their survey 32% of all freelancers plan to stop contracting in the UK.
That breaks down as follows:-
13% – Will look abroad for contracts
11% – will retire early or just stop contracting
8% – will move into permanent employment.
Has the Government IR35 gamble succeeded or failed
It looks like the gamble by the Government and HMRC has failed.
They believed that contractors would just grin and bear the massive tax hikes they have been hit with. They believed they would suck it up and just stay at their current companies.
What did our big companies think contractors would do
Many companies believed that contractors would suck it up too when they decided to blanket ban the use of PSC contractors. They thought they would all meekly accept their massive take home pay cuts.
Well, contractors are sick of being shoved around at almost every Budget and Autumn statement. Many of them will take it no more.
What will contractors do about the IR35 contractor market chaos
One in every nine contractors is going to take early retirement as they believe it is lo longer financially worth it to continue contracting. They believe they have seen contracting’s best days.
One in every eight contractors are going to take their skills and experience abroad in a new IT Brain Drain.
In total UK industry is going to lose access to one third of all their contractors. This will be a devastating blow to the UK economy. It is a huge blow to all our top companies’ ability to be able to deliver time-to-market solutions for their products and services. It will handicap them against their foreign competitors.
How will some of the UK’s big companies lose doubly when contractors depart
Indeed they may now find many of their ex-contractors bringing their skills, experience and business and systems knowledge to their foreign competitors.
This is a massive own goal by the Government and HMRC – and all to bring in tax the equivalent of less than a tenth of a penny on income tax.
Why cause total IR35 contractor market chaos just for that?
When is this madness going to stop?
Please share this article using the social media buttons at the top and bottom of the page.
Ad – Contractor Services
Many private sector contractors are likely to be told by their client company either that they must operate as an off-payroll employee or join an umbrella company. It’s time to plan for that now.
They need to look at umbrellas ASAP.
Do you need an umbrella company that is right for you and returns you most? Fill out the form below to receive a call today.
For all necessary business insurance, including IR35, click on Business Insurance for Contractors