From April 2020, UK contractors will have to rely on clients to determine their company status.
The Intemediaries Legislation will be extended to the private sector from April 2020 onwards, directly affecting a large number of contractors. What could this mean for the contractor landscape in London in 2020?
From April 6th 2017, the IR35 status of all public sector contractors was determined by the client, not the contractor. This arrangement is now being extended to private sector contractors from April 2020. This will have a number of affects on the contractor market, some of which are already becoming obvious.
Banking clients will tend to take a conservative approach and assume all contractors are within the scope of the legislation. As an example HSBC has already announced this.
This will mean banking clients have 3 main choices; don't deliver IT projects, offer permanent positions to contract staff or engage a consultancy.
We at Vega Financial Technology believe there is another way. We offer a number of options to enable you to deliver a trading system. We have the skills to deliver trading solutions as 'turn-key' projects, however we can also augment existing teams with trading-savvy engineers. Additionally, because we are small and agile, we can offer your existing contractors a route to retain their existing contractor status. We would do this by moving the contractor into Vega; they would continue to work on your project, but would be at an arms-length to you, the client. This is possible because Vega qualifies for the Small Business Exemption to the Intermediaries Legislation.
The Small Business Exemption covers businesses, such as Vega, with < 50 heacount.