Skyburst IR35 Image


What is IR35?

IR35 is complex tax legislation introduced in 2000 and now on its 5th iteration. It has been designed to combat tax avoidance by PSC’s (those who would be otherwise classed as an employee). In April 2021, the government are expanding IR35 from Public Sector (off-payroll workers legislation) into the Private Sector. This will apply to workers who operate via PSC (NOT sole traders, umbrellas or PAYE).

Why is this being expanded?

  • Over the last 30 years our economy and employment have changed massively
  • GIG economy, avenues of tax non-compliance are growing
  • HMRC have a view that tax is not being paid correctly with a c.£1.2bn shortfall p.a.
  • No side-stepping routes left for not paying taxes and NIC

What’s changing on 6th April 2021?

  • Clients, by law, must determine the IR35 status for each worker
  • If the assignments falls within IR35 then the 'Fee Payer' (last point of pay usually an agency or an umbrella) has to deduct PAYE, NIC & ENI taxes. Only applies to day rate excluding VAT
  • If the End Hirer does not make a determination, does not pass it on to the agency or makes an incorrect one, then they will be liable for unpaid taxes & NI
  • Fee Payer (agency) will be liable for unpaid tax should they fail to action the determination made by the End Hirer
  • End Hirer has to implement a ‘Disagreement Process’ should a worker not agree with a determination.

What criteria determine IR35 status?

  • Right to Substitution – need to have clear process / permissions / payment set out in contract. PSC has to pay the substitute worker
  • Supervision, Direction & Control (SDC)
  • Financial Risk – defect management / early delivery bonus
  • 'Part & Parcel' of the Organisation – length and frequency
  • Mutuality of Obligation (MOO) – typically exists where you have employment relationship
 Jan 22, 2021  Sharepoint Developer

O365 / SharePoint / PowerApps / Flow Consultant - Fully UK Remote

£400-500 per day

O365 / SharePoint / PowerApps / Flow Consultant Immediate start - 6... - read more...

  Contract  UK Fully Remote
 Jan 22, 2021  Project Manager

Part time Project Manager

£450 per day

Fully remote £450 per day Initially 40 days... - read more...

  Contract  UK Fully Remote
 Jan 22, 2021  BI Developer

SQL Technical Analyst

Circa £400 per day

SQL Technical Analyst, Contract (remote within UK). Our... - read more...

  Contract  UK Fully Remote
 Jan 20, 2021  BI Developer

Technical Consultant (MSSQL & Pentaho (or similar))

Negotiable around £400

Technical Consultant (Pentaho or similar / MSSQL) Fully Remote... - read more...

  Contract  UK Fully Remote
 Jan 19, 2021  Project Manager

Strategic Change Communications Lead

£400 per day

Strategic Change Communications Lead Contract - initially 2 months.... - read more...

  Contract  Glasgow
 Jan 13, 2021  Automation Test Analyst

Automation Tester | Contract | Glasgow

Are you an experience Automation Tester?   Would you... - read more...

  Contract  Central Belt
 Jan 12, 2021  Development Lead

React Web Developer (GraphQL) - Glasgow

£350 - £450 per day

Would you like the opportunity to work for... - read more...

  Contract  Central Belt
 Jan 11, 2021  Project Manager

Business Change Project Manager

£400 per day

Location – Glasgow (remote currently) Duration – initial 6 month... - read more...

  Contract  Glasgow

Be-IT Accreditations