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IR35 Update… Review or thrown out?

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IR35 Update… Review or thrown out?

​Speculation is the flavour of the day following the Government's release of their opinion splitting budget. The big news for contractors; IR35 revoked as of April 2023… or is it? The further you read into , the more confusing it gets with many places citing a review of the legislation, others saying its being thrown out and the entirety of LinkedIn posting about how great this news it. But is it great news?

When IR35 came into play in the private sector, this had a huge impact due to a large number of companies not being prepared and simply saying, “well then we won't use contractors”. The simple solutions are sometimes the best but it didn’t seem that way on this occasion with many contractors put out of work with short notice.

A snapshot of the last year would show you a lot. Companies really learning and defining their processes specifically, onboarding contractors and having no choice but to learn when contractors are needed and how they should be treated.  Companies hiring internal teams to complete IR35 determinations, tools created to make lives easier for determinations, companies increasing rates for Inside contracts to ensure they are easier to fill… and now, revoked / reviewed IR35?!

On the face of it, the news of the Governments plan may seem like good news. I am sure it will be in the long run however, I do expect some short term pain, should IR35 be revoked. People who have built a career off of IR35 will need to change roles; contractors who had their rate increased for going Inside will have their day rates decreased (although should continue to earn the same or better anyway)… companies will once again need to prepare for the changes that are hopefully coming next year… watch this space…

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