Steps contractors can take to manage IR35 reform in the private sector
After a period of disappointment and reflection following the introduction of IR35 reform earlier this month, the only thing left to do for contractors is to either wave the white flag or find a way to survive in the new landscape.
Whenever there’s significant economic turbulence, some businesses cease to exist, some tread water and some thrive. For those who thrive, some of this comes down to luck, but much comes down to the determination and strategy of business leaders.
In my opinion, contractors can draw some parallels from this. The essence of IR35 reform is to ascertain who is operating as a ‘true’ business. True businesses have leaders whose job is to develop strategies to survive and thrive, so the first box to tick, for those contractors looking to carve an outside IR35 future, is to embrace this task.
What’s your strategy for survival?
For many contractors, this will require a shift in thinking. Being a true business and therefore outside IR35 isn’t just an empty claim and the ticking of boxes – it’s about genuinely operating as a proper business.
At a glance, let’s have a look at some of the things that proper businesses do:
- They have a website and marketing materials
- They have a proper business domain for emails
- They indulge in sales and marketing activity
- They have marketing collateral, not job seeker CVs
- They have a budget and resources for acquiring clients
- They trade under their company’s name and brand
- They use social media to build relationships with clients
- Their database of prospects is crucial to their success
- They have multiple revenue streams for different services
- They work with multiple and concurrent clients
- Repeat business and referrals are the lifeblood of success
Ask yourself, how many of these things are you doing?
It’s a significant shift in thinking, but contractors who are determined to work outside IR35 can make this a reality.
Perhaps the future is a combination of inside IR35, umbrella, payrolled and outside IR35 work, but over time, an alternative strategy can achieve a growing portfolio of outside IR35 work.
If you would like to spend an hour learning how to make this a reality, join the Contractor Weekly webinar on April 12.
We’ll be talking about the IR35 changes and what it means for contractors, why your own perception of your business matters, how to transition from contractor to service provider, tips to challenge an adverse IR35 status assessment, what an outside IR35 CV looks like, what an outside IR35 LinkedIn profile looks like and how a contractor’s winning-work strategy may need to evolve.
For more information, please click here.