The Biggest Risk and Opportunity around IR35 Could Be in Sales
The proposed changes to IR35 will positively increase the PAYE tax yield for the UK Government. This does, however, place a firm financial burden upon contractors, suppliers and end hirers. The topic has been a frequent talking point throughout 2019 amongst the private sector, and understandably so.
A frequently ignored knock-on effect of IR35 is the impact this will have on managing directors and senior executives. The curious case of IR35 brings far more than just financial woe for affected firms. Especially for those who sit atop affected organisations. Senior management is left to deal with the additional headaches of the reputational, and legal damages being in breach of IR35 may bring.
There is a widely acknowledged level of difficulty when dealing with IR35. The reformed legislation seemingly lurks into almost every aspect of the organisational supply chain. HMRC however, would likely argue that a capable firm would likely have adapted their processes to be in line with the new reforms before the April 2020 deadline. Firms have had months to prepare for this impact and ultimately risk appearing lackadaisical or inept.
If you are a labour supplier, it may be worth considering that the top of the supply chain will grasp the IR35 management process to determine a better PSL. This could be a cause for concern amongst current clientele who do not have the best technology in place to embrace change.