Unless they class as a small private company, your end clients are now responsible for assessing the IR35 status of any contractors they engage, and they're liable if they get it wrong, but what does this mean for you as a recruiter?

Your clients will need your advice

For most end clients, hiring contractors is a small part of what they do. They have other important business to think about and will expect you, as a recruitment expert, to be able to advise them about IR35.

If you’re not confident that you can answer all their questions, you may need to undertake training, or sign-post your clients to compliance experts like Orange Genie. 

Where the client makes "outside" IR35 decisions

While this is usually the ideal outcome, if the client’s determination is incorrect, as the “fee payer” (the party who paid the contractor’s limited company) you may be liable for any unpaid tax and NICs.

For this reason, it’s very important to make sure your clients have robust processes for determining IR35 status.

Where the client makes "inside" IR35 decisions

In this case, you and the client are less likely to face compliance challenges from HMRC, but your contractors will take home less money, and there will be additional costs.

This makes contractors more expensive and retention more difficult, particularly where key skills are in demand. 

How to turn the situation to your advantage

The entire contracting industry has to deal with these issues, and the competitive advantage lies with recruiters who can give their clients the best advice, help them navigate the legislation and keep their contractors informed.

The first step is to involve Orange Genie Compliance. We can organise training for you and your staff, and help your clients quickly assess their contingent workforce and mitigate these risks. Our process is fast, convenient, and completely virtual so there are no social distancing issues.