Public sector bodies which engage contractors need no longer face high charges for IR35 status testing thanks to a free, automated compliance solution developed by ContractorCalculator, an online portal that has become the UK’s leading guide to contracting and freelancing.
HMRC estimates that 26,000 public sector contractors are affected by the reforms. With traditional IR35 tests proving expensive and often slow, a free new automated solution could hold the answer.
IR35Testing.co.uk could in theory mass test all of these contractors in a single afternoon – for free. This helps to massively reduce administration and costs for public sector clients. As some have thousands of contractors on their books, the ultimate savings for taxpayers are huge, and vital skills will stay in the public sector to support the delivery of frontline public services.
Commenting on the automated IR35 tool Dave Chaplin said:
“IR35 status diagnosis is now free. Contractors only have to pay for the remedies. Why should a contractor have to pay to be told that they are likely to fail IR35? We provide an initial result free of charge, after which point the contractor and client can make an informed decision about what to do next.
“It’s simple. A contractor can get a result for free in fifteen minutes. So if their status is clear, and no further action is taken, then they don’t pay. If the contractor wants to prove to HMRC that they have taken reasonable care over their tax affairs and are outside IR35, or find out how to turn a fail into a pass, they have the option to buy a comprehensive 30 page analysis Report for just £25.
“If a contractor receives a pass from IR35Testing.co.uk, this Report will help them to further mitigate their risk. This includes a uniquely numbered and verifiable certificate proving to HMRC that reasonable care has been taken to determine their tax status. Those who fail have the option to buy the Report which highlights in granular detail the areas that need to be addressed to pass IR35.
“Savvy contractors can decide to address these issues themselves, or use the Report to secure help from an IR35 legal expert. It’s only when you engage IR35 legal experts to mitigate tax risk that additional costs arise. These can be passed onto the contractor, with the knowledge that it’s going to be money well spent.
“We are speaking to public sector clients who need to assess thousands of contractors promptly and cost-effectively. We can do that for them, for free.”
The IR35 test was originally built in 2009 and has since been used more than 100,000 times. It has now been significantly enhanced and is composed of 101 questions, the answers to which are assessed by a bespoke, weight-based algorithm which is frequently fine-tuned in accordance with the latest IR35 tribunal cases.
“By pooling a unique combination of IR35 knowledge, employment case law and programming expertise, we are confident that IR35Testing.co.uk is the most accurate assessment available right now.”