IR35 Legislation Changes

Changes to the IR35 legislation took effect on 6 April 2017. Here’s a brief summary of what those changes mean for NHS trusts, and what Clarity can do to help.

What is IR35, and how is it changing?

IR35 is a tax law. It was introduced in 2000 to prevent tax avoidance by workers supplying their services to clients – like the NHS – via an intermediary.However, critics have always suggested that IR35 is weak because it allows the contractor to determine whether they fall inside its remit themselves. So, the most important change is that the end clients, and not the contractors themselves, will now determine whether staff fall inside IR35.

The client or the agency paying the contractor will now need to make tax and NI deductions, and the 5% allowance for ‘notional expenses’ will no longer be granted to IR35 contractors.

Why does this issue matter?

Agency spend is under the NHS spotlight, and it’s going to stay there for the foreseeable future. Everything agencies do matters. Meanwhile, tax avoidance at every level of society remains an obsession for HMRC.So, a tax law that would normally only interest the few that understood its complexities is now being referenced by senior politicians and the leaders of the NHS. IR35 is code for cracking down on tax evasion; shorthand for fairness on tax.

What is the opportunity?

Jim Mackey, the NHS’ Head of Improvement, has made the position of the NHS clear: anyone using a PSC will now fall inside IR35, so all agencies providing locum staff must ensure they’re subject to PAYE and payroll. This will, he admits, have ‘substantial administrative implications for providers’.Effectively, all agency workers will now be in a similar position to bank workers – meaning the switch from agency to bank has never been simpler or more worthwhile for NHS trusts. Trusts will want workers to be managed through a bank system, and the workers will be encouraged to join banks to improve their choice of shifts.

ClaritySTAFFBANK is therefore the perfect tool to tackle this issue – migrating agency workers to an efficient bank system quickly and easily. The ‘administrative implications’ would be proactively avoided.

How ClarityBANK can help – a few approaches

ClarityBANK – an IR35-proof solution

The changes to IR35 offers the perfect opportunity for NHS trusts to move agency workers to a bank. That means that having an efficient bank system in place is more important than ever.
ClaritySTAFFBANK is a state-of-the-art platform that manages your in-house bank staff comprehensively, with rapid vacancy publishing, auto-matching technology, end-to-end payroll and more. Better still, because it’s so easy to use and easy to implement, moving your agency staff to ClaritySTAFFBANK couldn’t be simpler.

Clarity – technology built with change in mind

ClaritySTAFFBANK is different. Unlike other bank software NHS trusts might have struggled with, it isn’t rigid – it’s built with change in mind. It can be used in combination with other technology, and includes a range of features that ensure complete flexibility for trusts and workers alike.

So when changes like those impacting IR35 occur, our systems won’t hold you back – they’ll speed things up. ClaritySTAFFBANK can move agency workers quickly and easily to a fully compliant and payrolled system. And once there, it can manage your staff efficiently, with a variety of time and cost-saving features.

Worried about IR35?

The changes to IR35 legislation shouldn’t scare anybody.

They simply mean that all the temporary staff your trust employs must be subject to PAYE and payroll. In other words, they should be treated like bank staff.

So moving staff to a bank system has never made more sense. The problem is that a lot of bank technology currently on the market is outdated and cumbersome. These systems are notoriously difficult to use and manipulate – and very resistant to updates and changes.

Clarity’s technology is different. Our state-of-the-art software is a market leader because it’s adaptive – built to quickly and easily manage workers and accommodate changes. And with the previous barriers removed, now’s the time to move your agency workers to ClaritySTAFFBANK.

Clarity – software you can bank on

Changes to IR35 have caused confusion and concern among NHS trusts and locum workers.

All agency workers must be subject to PAYE and payroll, and are now effectively treated like bank staff. So, we’ve come up with a solution: if they’re now treated like bank staff, why not make them bank staff.

ClaritySTAFFBANK can migrate agency workers to its innovative bank software quickly and easily. It allows for self registration and shift selection, includes auto-matching and streamlined payroll technology, and ensures multiple shifts can be posted on one screen – in just one click. It’s the first of its kind in the industry, bringing contemporary design and usability where it’s badly needed.

IR35 isn’t a challenge – it’s an opportunity. An opportunity to get more staff on to a bank system packed with time and cost saving features.

Request a demo of our ClaritySTAFFBANK technology today. Call us on 08450 063 752

March 29, 2017

Claire Billenness

Managing Director