The medical industry is one that will undoubtedly be affected by the changes IR35 will bring, yes, it is finally coming around again. Although there have been hopes that it will be delayed further, end clients are being told to prepare. HMRC have also stated that PSC’s won’t be subject to IR35 compliance checks, putting further emphasis on the hirer to determine status and possibly be the ones penalised if they get it wrong.
With many workers and Locums trading as Ltd companies still within the industry, the clock is ticking to get something in place to facilitate for this upcoming shift of contract workers, who will be moving over to PAYE or Umbrella services.
We have spoken with many companies over the past months who have Ltd workers operating through them and IR35 has always been a conversation topic but not one that many companies are actively looking into at the moment. The question is though, is it wise to put this off? Of course, many companies would have implemented changes for the 19/20 financial year, when it was initially meant to come into play. For those who haven’t, the deadline is going to be here sooner than they think and it may be wise to make sure you are set up and ready for it, ahead of time. It may seem far away, but once you consider, firstly what is going on in the world and then the Christmas period, followed by the January slog (do you really want to give yourself more work than you need there? We will be in the final weeks before IR35 kicks in, and you may find yourself running around to make sure you are fully geared up for the change.
The main reasons we are hearing for why companies are not making plans for IR35 are:
- Workers want to continue trading as Ltd companies as long as possible to maximise their benefits.
- It’s not imminent, and there are other areas that companies might feel are more pressing in the current climate.
- People are still reluctant to believe that IR35 will come into play from April ’21 giving the years delay we have already had.
The main reasons we think it’s worth looking into now are:
- Just because you have plans in place, it doesn’t mean your workers who are trading as Ltd companies cannot continue to do so up until April ’21, it just means you can rest easy knowing you are geared up for when it does happen.
- Whilst there was a fairly last minute extension of the scheme in 2020, all the signs are that it won’t happen again and it’s a risky game to proceed under the assumption that it will be delayed again.
- You want to be able to make sure you have got the best solution in place for both yourselves and your workers. This may include some shopping around, a lot of compliancy work and you want to give yourself time to make sure you have looked into this properly and got the best solution for your business.
These are definitely not easy times for anyone but just because now might be tough, doesn’t mean it’s a good idea to put off planning for the future. It won’t be long until we are in a post EU Britain and then there will be other reasons to put off planning for IR35. There may never be a right time on paper to prepare for the changes IR35 will bring but the later it’s left, it gets closer to being the wrong time. Our advice, look into this now, get your plan of action ready, save yourself the stress of rushing to implement a solution at the last minute and give yourself time to make sure you make the right decision.