WTT IR35As an award winning advisory service, WTT offers unparalleled expertise on IR35, ensuring you and your business continue to operate effectively, efficiently and compliantly through the reforms and into the future.
IR35 for Hirers
There are many risks and opportunities that will arise in April 2021 when IR35 reforms come into force in the private sector. Companies that act now will minimise risks and reap the rewards. If you haven’t already, hirers should look at how the new legislation is best integrated into the procurement of their contingent staff to limit the risk of non-compliance. We recommend setting up a steering group to consider the following:
What are the risks to my business?
There are operational, legal, and financial and reputational risks to getting this wrong. If it is determined by HMRC that a contractor is in fact a “disguised employee”, clients could pay charges amounting to more than 50% of the total amount paid to each contractor, plus fines and interest- and this could be backdated from 6 April 2021 up to four years.
This means that, in 2025, you could be liable to pay HMRC an additional 50% of your total contingent worker costs for the past four years, plus any fines and interest on overdue payments.
But what are the opportunities to my business?
There are new models emerging that present viable contingent workforce solutions. If implemented correctly and compliantly, these models could give you a competitive advantage as you attract off-payroll talent who can adapt to these changes. You can retain existing talent by utilising these solutions or even migrate these workers into your permanent workforce. However, to implement these changes you need to understand IR35 and fully understand the full composition of your workforce. IR35 can then be a positive opportunity to implement a market-leading contingent workforce solution. WTT Legal can assist you with understanding the legislation, implementing solutions and attracting and retaining talent.
It may be difficult to identify all of your off-payroll workers including the type of pay model, where they’re based and who’s supplying them.
Following an initial consultation, we can provide a full service to: 1) identify your total off-payroll worker population and 2) review your current processes. This data will be the basis for defining your strategies for IR35 compliance.
Our legal team will:
- Identify and categorise your workforce
- Review and assess each assignment’s position and implications under IR35
- Pinpoint workers that need to change their working practices
- Audit and analyse to evaluate the level of risk the company is exposed to
- Provide solutions so ensure future compliance
Contract Template Package
We can provide template contracts for the following engagements:
- Inside IR35 (client- umbrella)
- Outside IR35 (client- contractor) – direct
- SOW (client- agency)
- SOW (client- contractor) – direct
- Consultancy (client- agency)
- Consultancy (client- contractor) – direct
- Terms of Business (client – agency)
Status Determination Statements
We can assess each contractor and role, utilising our online Working Practices Questionnaire. The answers provided by the contractor are then considered together with the contractual provisions and a Status Determination Statement (“SDS”) is produced. A Confirmation of Working Practices, completed by the client, will also be provided.
For new assignments, an indicative SDS can be produced, based on the job specification and contract, followed up by a Working Practices Review, completed by the contractor, to ensure that the working practices reflect the contractual provisions.
For those contractors who are assessed as inside IR35 and are not appropriate for permanent or fixed term engagement, we can refer those contractors to a fully compliant umbrella employment solution. For further information, please contact email@example.com
Statement of Work and Consultancy
If some of your assignments are project-based and can easily be structured as a deliverable, outcome-based piece of work, why not manage them under a Statement of Work (“SOW”)? These are particularly appropriate for certain types of projects, commonly found in the IT or tech sector.
In a SOW you define the specific services that the contractor is expected to perform by detailing the work activities and deliverables. You detail the quality and level of service that you expect and outline a time schedule. Pricing and standard governance and regulatory terms and conditions are usually included as well. In some cases, you would outline the exact requirements of the job.
SoW offers an alternative to conventional recruitment models. Instead of supplying resources on an hourly basis, SoW provides fixed costs for achieving set milestones or deliverables. SoW is important because it offers an alternative for businesses whose requirements mean they may not get the same value in terms of cost and efficiency from traditional talent models.
Similarly, we can assist with reviewing consultancy-style arrangements either through your agency (providing consultancy services) or directly, with a consultancy company. In both instances, the provision of these services is outside the scope of the IR35 off-payroll legislation. This means it is the consultancy’s responsibility for assessing the status of the contractors working for them.
WTT Legal can assist you with drafting SOWs or consultancy agreements to ensure that it is genuinely the provision of a service. We can also assist with change control documents.
Contract Review and Amendments
Our team is highly experienced in contract review and can assist with drafting terms of business and other contractual documentation to mitigate risk to your business. In addition to ensuring that the IR35 liabilities and responsibilities are clearly flowed down to the supply chain, we can also conduct a full review of other legal issues to ensure that the contract is robust and enforceable.
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