With April just around the corner, we understand how concerning the changes around IR35 may still be for many contractors. It’s likely that employers looking to engage contractors may seek support to maintain contractual engagements either by reviewing their processes to maximise the probability of securing roles outside of IR35 or by seeking to engage workers on a Statement of Work (SoW) basis.
There are a number of hiring options available to ensure both our clients and contractors can continue to work successfully in a manner that suits them, whether the project falls inside or outside IR35. We’ve pulled together a high level overview of the options available to contractors.
Sign-up to deliver outcomes through a Statement of work based contract
This is a form of contract used by consultancies and agencies to agree work packages with clients.
A revised contract form helps to eliminates residual IR35 risk
There is an opportunity to increase effective rates through delivery risk sharing
Particularly suitable for experienced consultants who are confident of their ability to correctly scope work and deliver on or ahead of schedule
Cognitive Group offer a Statement of Work solutions to clients, please talk to your contact or get in touch below to see if this is something you can get involved in.
Take out IR35-Insurance
There are a number of insurance-backed options that cover the employer and worker. What do you get?
Extra peace of mind that you will get legal and financial support if audited
This process is straightforward and provides clarity for compliant contractors
Cognitive have carried out a full assessment of the market to ensure we offer you the most comprehensive and reliable IR35 insurance-backed model.
Use an Umbrella company to go inside IR35
As a contractor, you will technically be employed by the Umbrella Company.
Avoids IR35 risks by moving inside IR35
Helps you maintain independence and flexibility as a contractor
More appealing to hiring companies than Ltd company options
However, there are some risks to consider...
Unregulated Umbrella companies are offering high % take home to contractors – these do not protect contractor of employers
Consider whether to charge more to compensate for increased tax burden.
We have a duty of care for both the client and candidate, so will only provide a payroll service using FCSA or APSCO compliant Umbrella companies.
Go Permanent
Avoid IR35 risks by moving inside IR35
Increased job security & non-cash benefits
Reduced flexibility
Increased Tax burden
If you do decide to move over into a permanent role, you should seek advice as to whether or not this exposes you to a backdated IR35 assessment
Do nothing!
You may need to change your contract details and work practices to ensure the IR35 requirements are met
Ensure that your client has signed off their position and will not hit you further down the line
