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What are the IR35 tax changes and how do they apply to you?

What are the IR35 tax changes and how do they apply to you? 1800 1200 Growth Partners

The rules around IR35 and off-payroll working are changing, and from 6 April 2021, the new tax changes will come into force for the private sector. In this post, we discuss what’s changing, for who, and what the options are if you think you could be affected.

What are the IR35 tax changes?

From 6 April 2021, all private sector companies employing off-payroll staff – usually referred to as contractors – may have to take them on as an employee. If the employer dictates their terms, they can no longer be treated as contractors – they must, by law, be treated as employees.

Private sector companies receiving the services of a contractor will be responsible for deciding on the workers’ employment status.

The new rules make sure that all workers, who would have been an employee if they were providing their services directly to the client, pay broadly the same tax and National Insurance contributions as employees. These rules are sometimes known as ‘IR35’. The changes are all about making sure you have consistency in how you treat employees.

Who is affected by the IR35 tax changes?

The IR35 tax changes – also known as changes to off-payroll working rules – may affect any company receiving services from a worker who isn’t on their payroll. In most cases, these are companies that work with contractors. It could also be any worker who provides their service to a company through their own limited company or another type of intermediary such as:

  • a partnership
  • a personal service company
  • an individual

The company receiving the service is responsible for determining if the changes apply to them, rather than the worker providing the service.

You can use the gov.uk employment status for tax tool to help you determine any workers’ employment status.

What are your options?

  1. Do nothing

HMRC published a statement about supporting companies through this change and explained a ‘light touch’ approach to penalties will be taken in the first 12 months, unless there is evidence of deliberate non-compliance.

  1. Take the workers on as staff

Onboard these employees the way you would any new starter and include them in everything you do for your existing staff. This means a contract of employment agreeing pay, auto-enrolment pension, sick leave entitlement and the ability to accrue holiday leave and pay.

  1. Get business support from payroll and pension experts

You can outsource these responsibilities and the compliance that comes with it to a specialist payroll and pensions expert. You can do this just for the contractors or for all your staff.

How we can help

The change is coming, and we can help.

As payroll and pensions experts, we can advise you on your situation and the options available to you. Through our services, we can help process the increase in employees you are likely to have on your payroll and look after all of their needs. This means taking on the HMRC responsibilities – leaving you to focus on growing your business.

Through our SMART Employment model, we can also provide your new employees with the same range of benefits as other employees – making it clear your company is treating the new workers the same.

If your business is affected, contact us for a chat about your options or arrange a free, no-obligation consultation.

A look back at one year of working from home [Infographic]

A look back at one year of working from home [Infographic] 1284 720 Growth Partners

March 17 marks exactly one year since we turned off the lights at our offices in Leicester’s Colton Square and set up our workstations at home.

When the COVID-19 pandemic hit the UK in March 2020, our priority was to protect staff and client services. With our roots firmly based in developing the latest technology, we knew we had the tools to continue to deliver from anywhere and provide a seamless service to our clients.

Paul Bresnihan, Group Chief Executive Officer, said:

“It’s been a tough time for everyone, and we have taken some time to reflect on what’s been an unprecedented year.

We, like all businesses, have learned a lot from this crisis, and I am truly thankful to all our staff who have each played their part.”

The infographic below takes a look back at some of the positives we have taken while working from home for a year during the pandemic.

A reflection on the positives since working remotely:

  • 90,000 pay documents uploaded each month for clients through our payroll and pension services
  • 50,000 employees now using our platforms to access their pay, pension, discounts and physical and emotional wellbeing services through our EAP
  • 489 portals upgraded for our clients
  • Customer service satisfaction levels increased by 4% to 93% during this time, which evidences the seamless transition to remote working
  • Refocused our business with a new identity, website and app and realigned our people strategy
  • Continued engagement with employees despite the distance with 1937 virtual team meet ups and four employee engagement events
  • Mindful of the impact on our employees, we carried out 100 wellbeing sessions and arranged 20 pick-me-ups in the post
  • Through continued communication throughout the business, we celebrated a proposal, eight house moves and welcomed two babies and four new pets to the team
  • Working remotely, we adapted our learning, embracing more social and informal learning techniques

Want to learn more about us and our services?

Get in touch for a chat or arrange an online demo of our services – we’re working from home!

We’re proud sponsors of the Niche Business Awards

We’re proud sponsors of the Niche Business Awards 1500 770 Growth Partners

The Niche Business Awards take place virtually on Friday 22 January 2021 and we’re pleased to be sponsoring Digital Business of the Year.

The Great British determination has definitely come to the fore in supporting one another over the last year so we chose to sponsor the category for Digital Business of the Year as a fitting tribute to the efforts of local companies in surviving 2020.

Our CEO Scott Read said:

“We chose the category because it resonates so well with how all businesses will need to operate moving forward. Excellence in this area is not only testament to that business but can so often provide invaluable digital expertise to a host of businesses, streamlining efficiencies and making businesses more profitable.

It has paid to be flexible, adaptable and open during this time. In addition, it has become even more clear that you have to find a blend between your business needs and the needs of your employees. Everyone has faced uncertainty this year, and whilst making business decisions, it’s been imperative to think about how your employees are feeling and how these decisions will impact them.

Here at Growth Partners, we’re striving for a profitable and sustainable business where employees feel happy, fulfilled and appreciated. I think that more people are thinking about how they can add value, improve their businesses, and offer employees even more support and opportunities. There will never be a better time for businesses to adopt better employee engagement processes and a more fluid approach to agile working.”

Read more about the Niche Business Awards and see the list of finalists on the Niche Business Awards website

Our offer to finalists and winners of the Niche Business Awards

In recognition of all the excellent work by the companies who have entered the awards, we’re offering all nominees 50% off our payroll solutions and 12 months free payroll solutions for all winners for which the full terms and conditions are below. Our payroll solutions come loaded with employee benefits and wellbeing services which are of great support to employers and their employees particularly in these difficult times.

Exclusive Offer for Niche Business Awards

To find out more about our payroll solutions email hello@growthpartnersplc.co.uk or leave us a message here You can also call the team for a chat on 0116 340 3116

*Terms and conditions

50% off payroll solutions is available for all companies nominated for Niche Business Awards 2020 (taking place on 22 January 2021). This discount can only be applied when taking our SMART employment model. The minimum contract is 12 months.

For all companies who win their category at the Niche Business Awards 2020 (taking place on 22 January 2021), a 100% discount is available on the first 12 months of their contract. This discount can only be applied when taking our SMART employment model. The minimum contract is 12 months.

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