Search
Close this search box.

Autumn Budget to hit private sector contractors

This will lead to a significant increase in labour costs and a major administrative headache for companies which engage contractors working through their own companies (Personal Service Companies), exactly as witnessed in the public sector since April this year.
2019

The Government looks increasingly likely to extend the off-payroll IR35 rules in this week’s Budget to level the field between the public and private sector workers.

This will lead to a significant increase in labour costs and a major administrative headache for companies which engage contractors working through their own companies (Personal Service Companies), exactly as witnessed in the public sector since April this year.

The NHS, for example, must now assess whether a locum nurse or doctor providing services via their own Personal Service Company are caught by IR35 and, if they are, deduct tax and national insurance contributions from their earnings under PAYE.

While the reforms have led to public sector bodies adding about 90,000 people to their payrolls in the three months to 30 June 2017, they have also resulted in labour and skill shortages, as a number of IT contractors, locum doctors and nurses now choose to work less or work only for the private sector.

“The boom in off-payroll work is costing the Exchequer an amount estimated in some quarters to be as high as £4bn a year, and the Government will certainly continue its mission to fight this. Private sector companies who engage contractors should watch out for updates from the Chancellor, and seek information on how to best manage their position.”

Budget round-up – comment across the sectors

Read more

Latest News

Read More

A Four-Day Working Week in the Construction Industry?

29 March 2024

Newsletter

Receive the latest HR news and strategic content

Please note, as per the GDPR Legislation, we need to ensure you are ‘Opted In’ to receive updates from ‘theHRDIRECTOR’. We will NEVER sell, rent, share or give away your data to third parties. We only use it to send information about our products and updates within the HR space To see our Privacy Policy – click here

Latest HR Jobs

University of Warwick – WMGSalary: £23,144 to £25,138 per annum

The Open University – People ServicesSalary: £57,696 to £64,914 + up to £8,000 per annum MRP supplement*

Cardiff UniversitySalary: Competitive

University of Oxford – Oxford Department of International DevelopmentSalary: £28,759 to £33,966 (Grade 5)

Read the latest digital issue of theHRDIRECTOR for FREE

Read the latest digital issue of theHRDIRECTOR for FREE