The controversial IR35 changes were introduced on 6th April, but despite this, they are still chaotic.
IR35 is one of the most hotly debated and controversial issues that UK contractors have to deal with. However, despite all the frantic activity leading up to the changes, many contractors are still in the dark about what the changes are. Many are unsure about when, why, or how they might be deemed to be inside IR35 if they have a public sector client.
Many commentators on the contractor industry had called for consistency, but the exact opposite has occurred, with the confusion only being propagated. Contractors who work providing similar services have received completely different determinations, and this is seen not just in one public sector client but also across the whole sector.
This is of concern to the public sector as surveys have shown that 85 per cent of contractors have said that they will leave the public sector if they are placed inside IR35.
The Finance Bill clearly stated that public sector clients should not make general blanket determinations regarding IR35 status but should judge each case on its merits. However, there is evidence that at least two public sector organisations are adopting a one-size-fits-all assessment.
There have also been cases of contractors being assessed and then re-assessed with different outcomes. The reason for the reversal of the decision is often down to political reasons rather than a change of circumstances. This is concerning, but it does mean that contractors can challenge decisions.