IR35 in the Private Sector 2020: Reviewing the upcoming reforms

IPSE research: a third of freelancers plan to stop contracting in the UK because of IR35 changes

Nearly a third (32%) of freelancers are planning to stop contracting in the UK because the changes to IR35 due in the private sector in April, according to research by IPSE (the Association of Independent Professionals and the Self-Employed).

One in seven freelancers (13%) plan to find contracts abroad, one in ten (11%) plan to stop working or retire early and almost one in ten (8%) plan to move into employment. Half of freelancers also said they will only continue freelancing if they can find contracts to which the new off-payroll working rules do not apply.

97 per cent of freelancers said they are either “fairly” (18%) or “very” (79%) concerned about the changes to IR35. 92 per cent also said they think that working inside IR35 and paying employee National Insurance Contributions without employee rights is unfair.

In terms of client businesses, two out of five (39%) of freelancers said their clients will stop using outside-IR35 contractors. Instead, they will either make blanket-assessments that their contractors are all “inside IR35” (20%), engage them through umbrella companies (14%), move their contractors onto PAYE (13%), or stop engaging contractors altogether (11%).

However, 35 per cent of freelancers also said their clients are uncertain (16%) what to do or have not said (23%) what they will do about the changes to IR35.

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