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It’s been a few weeks since I wrote a blog about the repeal of the off-payroll rules for IR35 (https://www.gsatechsource.com/blog/2022/09/ir35-repealed ) I have left it this long to write a follow-up just to be sure there are no more u-turns before I do. Clearly, there aren’t, the repeal of the repeal stands, and we are back to the old, flakey, poorly implemented off-payroll rules for both the public and private sectors. The vague and inaccurate CEST tool remains, the determination decision remains with the end client (except for SMEs in the private sector) and what really constitutes employment as a contractor is still not clear. What needs to happen now is a full review of IR35, what is employment, and what is a contract role so all in the supply chain are clear where they stand. There must be no need for a user of contract resource to deem everyone inside the off-payroll rules simply due to the level of risk being unknown when doing otherwise (just look at the vast fines handed down to the government’s own departments – if they can’t get it right, then what hope do other organisations have?) The speed of the u-turns following the Truss / Kwarteng mini budget were lightning fast, but I won’t hold my breath for seeing a review anytime soon. I just hope I am proved wrong.

In January 2022, the government announced that, from 6 April this year, employers would be allowed to continue conducting remote Right to Work and criminal record identity checks, providing they used certified Identification Document Validation Technology (IDVT) supplied by a Digital Identity Service Provider (IDSP). The government has since launched a ‘trust mark’ scheme – the Digital Identity Certification Scheme (DICS) – to help employers identify those digital identity providers, which meet standards set out in the government’s Digital Identity and Attributes Trust Framework (DIATF). GSA has now partnered with Yoti, a well established (2014), fully certified IDSP and experienced provider, with over 12 million app downloads. There are alternatives to using the IDSP’s digital right to work checking services for those whose situation requires an alternative method: -Using the online Employer Checking Service (https://www.gov.uk/employee-immigration-employment-status), to electronically check whether applicants are legally allowed to work in the UK. This service is only open, however, to eligible individuals with EU, EEA, or Swiss immigration status who can provide a valid share code, obtained from the Home Office. -Conducting a manual document check using original documents from Lists A or B of the Home Office’s list of acceptable documents to ensure that the documents are genuine, and that the employee is the rightful holder and permitted to do the type of work on offer. Choosing this option requires employers to make clear copies of original documents, which must be retained in a format that cannot be manually doctored, and viewed in person. However, for anyone with a UK or Irish passport, the quickest and most secure way for GSA to check the right to work is with Yoti, all done via a mobile device or PC with a simply URL link.

I think many of us have been expecting, or at least hoping for, a much needed review of the IR35 off-payroll rules now that Liz Truss has become PM. It was a shock today to hear that the 2017 public sector and 2021 private sector changes are now to be scrapped in April 2023! Speaking to the House of Commons Kwasi Kwarteng said from April, workers across the UK providing their services via an intermediary, such as a personal service company, will once again be responsible for determining their employment status and paying the appropriate amount of tax and NICs. The 2017 and 2021 reforms to the off payroll working rules required the end client, and not the contractors they hire, to decide if the working relationship resembles a self-employed engagement or employment and thus whether IR35 applied. Kwarteng has repealed these reforms as part of the first steps in taking complexity out of the tax system. He said: “To achieve a simpler system, I will start by removing unnecessary costs for business. We can also simplify the IR35 rules and we will. In practice, reforms to off-payroll working have added unnecessary complexity and cost for many businesses. “So as promised, by the prime minister, we will repeal the 2017 and 2021 reforms. Of course, we will continue to keep compliance closely under review.” The changes will mean workers will again be responsible for determining their employment status and paying the appropriate amount of tax and national insurance contributions. Due to the fact that the 2017 and 2021 changes forced many genuinely self employed workers to be 'caught' by the legislation, the proposed repeal will minimise the risk that genuinely self-employed workers are impacted by the underlying off-payroll rules. Time will tell if those in current inside contracts will risk changing their status come April, but let's hope it reduces the ongoing confusion and cost that has surrounded the off-payroll rules for the last 5 years!

At this time of year, it is hard to imagine the stress and fear that many migrants face trying to escape from lives and lands less safe than our own. I just want to say another big thank you and well done to one of our consultants, Lauren, for her repeated huge efforts in collecting (and making the rest of us collect) more clothing, bedding,household goods etc for refugees, for a SECOND big delivery we have just made to our chosen refugee charity, Derbyshire Refugee Solidarity. We hope that our small efforts will help to make things a little less daunting for those arriving in the UK, and for those stuck in refugee camps awaiting a safer life. We filled our boardroom with donations, which we delivered in a convoy of employee’s cars to the refugee centre in Derby #derbyshirerefugeesolidarity

LET GSA TECHSOURCE MANAGE YOUR IR35 PROCESS The IR35 reform deadline date of 6th April 2021 has been cemented and, with just a few months to go, time is quickly running out to make sure you have a fair, efficient process in place. GSA has partnered with Kingsbridge to provide an award winning comprehensive IR35 solution that manages the entire process, from status assessment to process consultation, so you can confidently and compliantly maintain your flexible workforce outside IR35. WHAT CAN THE KINGSBRIDGE IR35 STATUS TOOL DO FOR YOU? The Kingsbridge Status Tool provides: Fast, efficient and accurate IR35 assessments Access to real time reporting IR35 specialists on-hand to assess indeterminate status result Interaction with the whole supply chain, including unique circumstances The ability to request a manual review irrespective of the result produced by the tool HOW DOES THE KINGSBRIDGE IR35 STATUS TOOL WORK? The Kingsbridge IR35 Status Tool takes a best-of-both approach, allying a custom-designed automated process - developed by Andy Vessey ATT, ex-HMRC, tax advisor, and a leading IR35 specialist who has defended over 500 investigations, most of which he has won - with in-house expert consultancy to provide the quickest, most accurate IR35 status result available. If it’s a clear-cut case, the tool then generates an instant determination, as well as a comprehensive report that pulls through the notable positives or negatives of a given engagement, as well as an official Status Determination Statement (SDS) that you can supply to the contractor. If it’s a borderline result, the answers given are passed over to one of Kingsbridge’s in-house IR35 specialists for further manual review. Kingsbridge is currently the only IR35 status provider on the market to offer a hybrid solution, and we firmly believe that it’s the best one-stop-shop to meet all your IR35 business requirements. IR35 PROTECT OFFERS ADAPTABLE TRIBUNAL COVER FOR CONTRACTORS If a role is successfully outside of IR35, it is important to back the assessment with IR35 insurance. Kingsbridge offer a market leading, Zurich underwritten IR35 insurance policy that protects the whole supply chain for up to £100k legal defence costs and £100k tax liability, as well as providing a legal expenses policy. Not only does this insurance protect the contractor in the run up to April 2021, it's also designed to flex come the reform deadline to cover the fee-payer as well. This means that the entire supply chain is protected against the potentially crippling costs of an IR35 enquiry and any tax debts found owing - peace of mind for the contractor, and a safe bet for the fee payer. Find out more about IR35 protect here.

As most people involved in the contract market will know, the Off-Payroll in the Private sector (IR35) legislation was delayed in April 2020 due to the Covid-19 pandemic but, sadly, is due to go live in April 2021. One thing that this legislation will spawn, as the Off-Payroll in the Public Sector did in 2017, is a raft of tax avoidance schemes that will appear to be legitimate but aren’t. Unscrupulous operators will set up what will appear to be honest and lawful umbrella companies but will promise a take-home pay rate of 80 or 90% of gross pay. As always, anything that appears too good to be true is either not true, or illegal! The most likely way they will do this is to convert your income into a ‘loan’ and use this as a method to avoid paying National Insurance and Tax. However, these schemes are not legal and HMRC will close them down and come after you for underpaid tax – it is likely that you will end up paying more than you should have done in the first place. Note that some of these schemes will claim to be HMRC approved – HMRC does not approve tax avoidance schemes. Be wary of any agency that insists you use a certain umbrella or scheme in order to secure a role, and don’t presume that just because a fellow contractor uses the scheme that it is safe – they may have an incentive to get you on the scheme or may not be aware themselves of the huge risk and liability they face. A reputable agency is likely to ask you to only use an FCSA approved umbrella as this will give all parties protection in knowing that it is acting lawfully. Make sure you do your research and don't believe anything that looks too good to be true! We can supply you with details of a number of FCSA approved umbrella companies and are happy for you to decide which one to use.