IR35 – update

As a general update about where we are with IR35, it’s playing out as expected. Some employers, as predicted, are proving to be risk-averse and particularly those who do ‘blanket determinations’ – where employers are making flat judgments based on job titles or the amount of work a freelancer does for them.

We’re also seeing the predicted knock-on in which Self Employed Sole Traders are being treated differently now even though IR35 was, in theory, targeted at people who trade through a limited company.

The whole thing is also showing how unfair the whole freelance deal is – where you get the tax status of an employee but – at best – the employment rights of a ‘worker‘ – all of the precarious downsides.

You may know that there are some job titles that are on the old Appendix 1 – now called ESM4118 – list of jobs that can be reasonably presumed to be self-employed (and therefore not likely to result in HMRC action for being wrongly classified). We also know that there are a lot of job titles that could be on there but aren’t.

To help with this, we did a load of research earlier in the year to identify those job titles – we’ve passed it on to production accountants and we’d like engagers to adopt this research.

It included a briefing to reps and members on how to challenge employers who are being over-cautious and we’re currently trying to find out how much of a problem this still is. If anyone wants copies of either of these, please drop me a line!

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