The Secret Contractor: IR35 rules aren’t just damaging my business – they’re damaging my clients’ too

I feel so downtrodden since the IR35 rules came into effect in the private sector in April this year. IPSE are doing so much to try and get fairness in this policy and I would like to share my story.

I have operated via my Limited Company as a contractor since 2008 and have worked hard to build up my network and client base. I have also always used due diligence and independently had contracts assessed to determine my IR35 status, which has been outside of IR35.

When the IR35 rules were delayed last April due to covid, the company I was contracted to put an immediate blanket ban on all limited company directors and my contract along with 20 other contractors was terminated as we refused to go via an umbrella company when we have our own payroll systems set up.

Then due to lockdown I was unable to engage any contracts for 5 months. No pay, no furlough, no government support. Finally in August 2020 I was able to engage a contract with a previous client I had worked for. I assessed my contract using IR35 Sheild and was determined outside of IR35. I remained with this client until the end of March 2021, and only left as they had deemed all contract roles as inside IR35 via CEST when they clearly were not.

I managed to find a contract outside IR35 but that was only for 3 months from June to September 2021. Since that contract finished last month, I have been trying to find another contract but job advert after job advert that match my skill set of Business Transformation or Cyber Security are all stating ‘umbrella only’, which I feel is wrong.

Another client contacted me last week and has offered me a 6-month contract but has stated that the role is inside IR35 and an umbrella company is the only option for this engagement. I have not had a one to one status determination conducted, only told that the role is inside and they will not increase the day rate to compensate me for my loss of earnings. The company are even telling me which umbrella company I am to use. Today I have had a profile of “take home” pay from the said Umbrella Company and I can’t believe how low my monthly salary will be. Employers NI, Apprenticeship Levy and their cut makes for very sad reading.

But sadly, I now have no choice but to take it. I am skint and eating into my now very limited pension savings due to no work or furlough. I am gutted and can’t understand how this has been allowed to happen. How can I be forced into using an umbrella company with no employment rights while having to use my own laptop and mobile phone. I am either an employee or I am not?

I am a professional who feels exploited by this ruling. I also feel worthless and am beginning to think there is no point in contracting anymore. We work hard with no security, no holiday or sick pay, no pensions, no employment rights, and other benefits of permanent employment.

Perhaps there is some light at the end of the tunnel – IPSE’s recent research into IR35 suggests that two out of five freelancers have worked on outside IR35 contracts over the past year. So, despite the new rules some clients are adjusting to the new rules to ensure they can attract freelance talent – hopefully others will soon follow suit, for the sake of their own businesses and ours.

Visit our IR35 News page to keep up with the latest updates, and you can find more support and useful information with our IR35 guide.