Have a question around the IR35 changes? We’ve provided some answers to the most common IR35 FAQs below. If you have any further questions, please do not hesitate to contact us.
What is IR35?
IR35 is also known as ‘intermediaries legislation’. It is basically a set of rules that affect your tax and National Insurance if you have a contract to work for a client through an intermediary.
An intermediary can be:
- your own limited company
- a service or personal service company (PSC)
- a partnership
You may need to follow IR35 if you work for a client through an intermediary.
When are the changes happening?
The changes will take effect from 6th April 2017, which is the beginning of the 2017/18 tax year.
What is an umbrella company?
An umbrella company in short is a company which employs contractors who are providing services to clients on a temporary contract basis. Using an umbrella company is an alternative to setting up your own limited company. They serve as an intermediary between the contractor and their client (either an employer or an agency), with their principal responsibility being to organise payment for your work.
Do I now need to move to an umbrella company?
It is best to seek advice on what is the best option for you, dependant on your current circumstances.
Will I see a decrease in my pay?
If you are considered to be ‘inside IR35’, National Insurance Contributions (NICs) and employment taxes will be deducted directly from your pay before being paid to your PSC/limited company. It is best to seek advice on changes to your personal circumstances.
What is the benefit of staying with an agency after the changes?
If you continue to work through an agency, you are likely to receive a better hourly rate, desirable working arrangements and the flexibility you want. You will also be entitled to bonuses and extras that are not available elsewhere.
What do I need to do to comply with the new rules?
You don’t need to do anything. The NHS Trust or Health Board will decide whether or not you are ‘inside IR35’, and if the relevant taxes and NICs will be deducted.
Which roles are being affected?
It is up to the NHS Trust. They are following rules and guidance from HMRC, but is expected to affect all agency workers paid through a limited company, who are not paid via PAYE or an umbrella company.
If I work through an agency, am I affected?
These changes will affect any agency worker in the NHS who is not currently enrolled in PAYE.
Most agency nurses I know work through a limited company – is this still the best option?
Nurses working through limited companies will be most affected by the changes in legislation. However, we’re here to support you and minimise the impact of these changes.
Will I have to return to working permanently for the NHS?
You will still be able to work through an agency, as the NHS demand for locum workers is likely to remain high even after the changes. Swiis will still be able to pay you rates of pay higher than those of the NHS substantive staff.
Who can I contact if I have any questions?
All Swiis Health & Care nurses can contact us here