Budget announcement creates more compliance concerns

IR35 private sector compliance

5th November 2018

There’s no doubt that, for UK based agencies at least, the Chancellor’s latest Budget has been a key talking point. In particular, the announcement on IR35 is one that many recruiters working in the contractor placement sphere will have been keeping their eye on.

IR35 and the private sector

As a summary, Chancellor Philip Hammond announced what many expected last week: IR35 rules will be extended into the private sector. Eventually, anyway. While of course this legislation only applies to those deemed to be employees by HMRC, we know from the roll out in the public sector that it will cause a level of confusion across the contracting field.

While in the announcement it was revealed that it will be the responsibility of the company (excluding small businesses, who are exempt from this rule change) to decide which contractors fall within IR35, there wasn’t any clarity as to who exactly in the placement process is classed as the responsible company. While more details will likely emerge before the 2020 roll out, for now at least, recruiters and contractors alike are understandably concerned.

The importance of compliance

The crucial takeaway from this latest move is the fact that contractor compliance is becoming a much more complex business, and the risks are growing. But, with the continued growth of the gig economy and the simple fact that for agencies, this avenue is a particularly lucrative field, it’s an area that cannot be overlooked.

Instead, recruiters need to be looking to expert partnerships in order to ensure their firm and the contractors it works with remain compliant with legislation, regardless of where in the world they choose to operate.

Our knowledgeable team has the international experience to be able to help agencies stay abreast of any such legislative changes. Contact us today.


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