Following the Budget announcement on 11th March 2020, ARM have prepared some slides that detail the top-level facts around IR35 and highlight some of the key areas that require our attention and due diligence.

1. The Off-Payroll Rules in the
Private Sector – Update March
Strategic Resource Management

2. IR35 Overview
IR35 OVERVIEW
1. What is IR35?
2. General Principle
3. How it is determined
1. Case law not legislation
2. Takes into account full working
practices
3. Test for tax status – not
employment rights

3. Client responsibilities
• Determine the status of each assignment – even if “Inside” or policy ban of PSCs in place/
• Use reasonable care in making determination – see guidance.
• pass the determination statement to party that it has entered into a contract with and the
worker.
• Include reasons for determination.
Client
Agency
1
Fee-pay
er
PSC Worker
Contractual chain
Proposed change
(tax liability)
Client required to provide status
determination together with the reasons for
determination to party they contract with and
the worker. chain
1 2
Status determination and reasons for
determination are required to be passed
down the contractual chain.
3
Client required to provide status
determination and reasons for
determination to worker.

4. Client
Contractual chain
Action required
Proposed change
(tax liability)
Agency
1
Agency
2
Agency
3
Fee
payer
PSC
Status determination flows
down contractual chain1 2 Agency 3 fails to share the status
determination with the feepayer 3
The liability initially sits with
Agency 3
4
If HMRC fail to collect the liability
from Agency 3 the liability transfers
directly back to Agency 15
If HMRC fail to collect the liability
from Agency 1 the liability finally
transfers to the client
Supply chain risk
• Supply chain’s responsibility to pass the SDS down the supply chain – if SDS not received from client
then they can pay the worker gross.
• It is the “Fee Payer’s” responsibility to deduct tax and NI at source.
• Agency 1 take on additional liability for supply chain failure.

5. ✔ The people making the decisions should be trained, suitably qualified and
understand the rules.
✔ The need to consider all facts and speak to different teams internally and
also the contractors – directly or through a recruiter.
✔ Consider determination method for on-going determinations.
✔ Keep records of decision and communicate the decision.
✔ Re-do determinations periodically – on extension/every 6 months.
Reasonable Care….?

6. ✔ Statement of work – ensure you read government guidelines fully and take
advice.
✔ Blanket bans vs policy changes.
✔ Appeals – turn around quickly.
✔ Supply chain compliance & financial stability.
✔ Start looking at adjusting working practices to engage true self employed,
valuable/niche resource.
What to be cautious of

7. How we can help
IR35 Change Management and Support Services
✔ PMO for clients and/or external providers to execute joined-up solution
✔ Manage contractor communications
✔ Advise and manage changes to payroll model if required
✔ Strategic resource planning post April 2020
✔ Tailored contracts to support status and supply type
Our value proposition:
ARM offer our clients significant expertise and robust processes for both existing and future
contractor population, providing clients with a compliant, efficient and cost effective service and to
achieve the following objectives:
• Increased mitigation against legislative, financial and reputational risks
• Streamlined, efficient financial process and improved working capital
• Enhanced contractor care, management and communications

8. How we can help…continued
Supply chain risk management
supply chain consolidation or Vendor Managed Service including Workforce & Supply Chain Audits:-
Management of Direct contractors
Minimising your risk and administrative burden
Alternative resourcing solutions
• Fixed price assignments
• Statement of Works (SoW)
• Employed models
• Service outsourcing.
✔ Contractor payroll mechanisms
✔ Supply chain compliance
✔ Managed Services Company compliance
✔ Criminal Finances Act compliance
✔ Onshore & Offshore Intermediaries compliance
✔ IR35 compliance, both now and future risks
✔ Contractual terms
✔ Insurance levels
✔ Right to Work
✔ National Living & Minimum Wage
✔ Working Time Regulations
✔ Agency Worker Regulations

9. Transition
Management
Questions & Answers
Any questions?
Contact us