IR35 ignorance: Is it still a thing?

The extension of the off-payroll reforms into the private sector took effect in April 2021. Almost 12 months in, have engagers (end clients) got to grips with IR35 and their new responsibilities?

The IR35 reforms saw responsibility for defining whether an assignment is inside or outside of IR35 change from contractor to engager. The potential liability for incorrect or unpaid taxes and penalties came with that change. Recent case studies from the public sector have shown how substantial those taxes and penalties can be.

Therefore, it might be reasonable to think that engagers of personal service company (PSC) contractors would have addressed their IR35 responsibilities.

Since HMRC implemented the reforms, we’ve talked to engagers and contractors alike. Whilst some businesses appear to have met IR35 head-on and are prospering, we are still seeing and hearing of many worrying instances where the IR35 reforms have not been adequately addressed.

Are clients meeting their IR35 responsibilities?

The initial response to the IR35 reforms from many engagers was to take a blanket approach and define all contractors as inside IR35. This response stimulated a mass migration to PAYE solutions via an agency or umbrella company.

However, our previous blog, IR35 – The importance of supply chain compliance, highlighted the risks associated with such an approach.

Of more concern are the engagers we have heard about or spoken with who have not taken action.

We still hear of engagers relying on outsourced processes (along with responsibility and liability) as their defence. Others claim to have indemnity clauses passing on responsibility and liability for non-compliance.

In our experience of the initial enquiries conducted by HMRC, such approaches will not meet requirements.

According to HMRC, engagers must take reasonable care and responsibility for ensuring that status determinations are accurately assessed. Failure to demonstrate a robust and compliant process is unlikely to meet reasonable care requirements. Claiming diminished responsibility due to outsourcing is even less likely to appease HMRC.

Reliance on indemnity clauses is also an extremely risky tactic, with many such clauses being unenforceable according to previous case law.

Workr recommendations

Initial HMRC enquiries have focussed on engagers providing evidence of their IR35 status determination processes.

In our opinion, this is a clear indication of HMRC’s expectations concerning reasonable care requirements.

At a minimum, whether you have sought outsourced support or not, Workr recommends defining and documenting a process for each status determination you make. This process and each determination should be reviewed regularly to ensure fitness for purpose and accuracy.

We also recommend a detailed review of all contracts in the supply chain. Although your legal advisors may insist on inclusion, a robust and compliant process should remove the need to include indemnity clauses.

A review of contracts in the supply chain should ensure that clauses in all contracts down the supply chain are consistent and do not contradict each other. This is especially important with regard to key IR35 tests such as the right of substitution and mutuality of obligation.

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.

For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

IR35 – The importance of supply chain compliance

Before the Off-payroll reform legislation was introduced into the private sector in April 2021, much of the focus was on the new responsibilities of the engager.

Understandably, such a significant change to the legislation was likely to grab the headlines. However, the significance of the change may well have distracted attention away from other, equally important areas of the legislation.

The reforms saw the definition of whether an assignment is inside or outside of IR35 change from contractor to engager. Along with that change in responsibility came the potential liability for incorrect or unpaid taxes and penalties.

The response from many engagers was to take a blanket approach and define all contractors as inside IR35 encouraging migration to PAYE solutions, either via an agency or umbrella company.

However, these actions may not be the get-out that engagers felt they might be. With a plethora of other legislation at HMRC’s disposal, are the off-payroll reforms just a trojan horse strategy that will allow HMRC to expose non-compliance in the broader supply chain?

What should supply chain compliance include?

Before the reforms took effect, there was a lot of reliance on contract terms and conditions, delegating responsibility and liability to those further down the supply chain.

In many instances, engagers out-sourced supply and compliance to a managed service provider (MSP), including indemnity clauses passing on responsibility and liability for non-compliance.

However, this approach may not be quite as risk-free as it appears.

In its original guidance notes (Employment Status Manual, esm10014), HMRC encouraged the involvement of professional advisors and support in the determination process. However, they also clearly stated that simply outsourcing the determination process would not relieve the engager of responsibility or liability and may not be deemed as taking reasonable care.

Recent case law (Udlaw Limited v Revenue and Customs, 27/01/2020) also referred to the HMRC Compliance Handbook – CH84540 concerning reasonable care. Referring to the manual, it stated;

A person cannot simply appoint an agent and deny responsibility for their tax affairs. The person has to show that they took reasonable care, within their ability and competence, to avoid default by their agent.

Therefore, supply chain compliance must include an element of due diligence where the engager can demonstrate that it has gone to reasonable lengths to ensure that all parties within the supply chain operate legally and compliantly.

Due diligence should include regular audits and reviews and a requirement for regular data and reports to support the financial trail created by the contingent labour engagements, particularly those related to taxes.

What are the risks of non-compliance?

Where the engager is deemed not to have taken reasonable care in determining the IR35 status of a contractor, HMRC can transfer any debt for unpaid taxes to the engager. This is the direct threat to engagers following the introduction of the reforms.

However, if we consider our trojan horse theory, HMRC has several other pieces of legislation at its disposal. The criminal finances act and managed service company legislation immediately spring to mind.

If HMRC uses the off-payroll reform legislation as a route to investigating the broader supply chain, it would be advisable for engagers to prepare in advance.

Financial malpractice and tax avoidance in the supply chain could easily see engagers deemed complicit with financial penalties and even jail sentences for Directors.

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.

For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

Kick-starting a culture of continuous improvement

2022 is the year Easypay fully reforms recruitment finance. We’ve always been dedicated to helping smaller recruiters get finance via our platform. But now, we aim to make it quicker, easier and more accessible for the end user.

In order to achieve this, Director of Operations Charlotte Allen has been reworking internal systems, increasing collaboration between teams and improving the customer experience. To coincide with her six-month anniversary at Workr, we asked Charlotte to describe these projects in more detail, and share what she’s looking forward to this year.

Settling in

Starting a new job while working remotely sounds like a challenge, but with Workr Solutions and Easypay Services, it was easy. Not only are the teams hardworking, they’re also incredibly flexible when it comes to adopting new processes and technologies.

When I was brought on, the idea was that I would be introducing automation software as well as better project management. All these innovations were wholly supported by my colleagues, who would always share ideas, suggest improvements and go out of their way to ensure they were delivered.

It’s a testament to our cohesiveness and knack for collaboration that despite operating remotely, we’re able to work together as seamlessly as we do across multiple locations. This certainly makes back-office improvements easier to implement.

Introducing new tech

Now, we’re on the cusp of moving to a new system for our funding business, which provides an end-to-end seamless connection between our agency clients and all other stakeholders. This means that Easypay customers will enjoy a more user-friendly journey, and the team can focus on customer experiences.

Specifically, with less time spent on administration, we can help to address customer queries, add more value to our service and act as an advisor on any funding-related issues. This helps to kick-start a culture of continuous improvement and gives staff room to grow.

Of course this is just one of the initiatives Easypay is introducing to transition to a self-serve model. Already we empower customers to choose the type of service they want, with additional features like payroll, credit control and legal and bad debt protection if needed, as well as management accounting services.

Looking to the future

Currently, everything is process focussed, and with the team entirely dedicated to back-office improvements, there hasn’t been much opportunity to think about the future. But one thing we can expect is that this will be a year of customer experiences.

With Workr Solutions and Easypay growing daily, our aim is to lead the way when it comes to providing support. That means innovating where competitors aren’t doing so, and regularly reviewing our service offerings.

In our industry, organisations often become too results driven, compromising the quality of their support. But by refining our back-end processes and constantly revising how we can help smaller recruiters understand finances, we can create new products and services that will make an actual difference.

How Workr can help
Curious about funding or back-office support? See how Workr Solutions or Easypay can help by getting in touch today. Whether you’re just starting out or are looking to scale up, we’ve got the solution for you.

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IR35 investigations – what you need to know

The off-payroll reforms have received a great deal of air time over the past 18 months, and you’d be forgiven for growing tired of all that IR35 talk. Add to this all of the other distractions such as Christmas, Omicron and party politics (literally), and it’s easy to understand why there has been a lull in all things off-payroll reform.

However, our advice to anyone involved with temporary labour, IR35, and compliance is don’t get complacent.

Whilst we have all been taking a festive break or trying to avoid Omicron, working from home or returning to the office, HMRC has been diligently working away in the background.

Whether it’s been declaring the results of investigations into public sector bodies (see our previous article) or kicking off investigations into private sector engagers, IR35 certainly hasn’t gone away.

IR35 investigations, the lull before the storm

Working closely with several high volume contract end-users throughout 2021, we have gained first-hand experience of HMRC’s commitment to this legislation.

As of 06/04/21, if you haven’t been managing your PSC’s and ensuring that they have a clearly defined status determination, then our advice would be to buckle up.

It’s taken HMRC almost four years to conclude some of their investigations into public sector organisations. The results, however, published over the last six months or so, are enough to make anyone sit up and take note. With a combined tax bill of approximately £250M, the recent publication of these results is surely not down to coincidence.

However, it’s unlikely that it’s going to take HMRC quite as long to get its teeth into the private sector.

Indeed, investigations are already well underway, with HMRC sending RFI letters to engagers from several industries. In many cases, HMRC has followed this up with in-depth and challenging meetings and interviews – we’ve supported clients that have had as many as three already.

So, whilst there may well have been a lull and some IR35 lethargy in recent months, now is a great time to refocus and ensure that your IR35 processes are fit for purpose and compliant.

Looking beyond the SDS 

The best piece of advice that we can offer based on our experiences with HMRC so far is to think well beyond the SDS (Status determination statement).

Initial RFIs focussed on processes, documentation and systems used to make status determinations, including whether the government’s own CEST tool had been used.

Additionally, questioning around alternative determination systems has been far more detailed, including the weighting used for individual questions.

As anticipated, HMRC has looked at the content of contracts down the supply chain. In particular, looking at the consistency of contract terms and the application of these terms in the working environment.

This questioning has also expanded beyond the engager to all of the stakeholders in the process and, we would argue, outside the legislation’s scope. Irrespective, the direction and focus of these initial enquiries demonstrate that HMRC is looking more broadly and deeply than some would have anticipated.

In our opinion, end users will likely have to demonstrate their responsibility for their supply chain. In other words, it won’t be enough just to say we didn’t know.

End users will be well advised to ensure that they understand and control what happens beyond their boundaries when it comes to contractors. 

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.

For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

IR35 compliance – IR35 in 2022

It’s fair to say that the lead-up to introducing the Off-payroll reforms to the private sector was anything but smooth.

When the Off-payroll reforms were introduced into the private sector in April 2021, two full years had passed since the government confirmed its intentions to introduce the reforms. The private sector had also benefited from witnessing the introduction of the reforms into the public sector back in 2017.

The pandemic forced many businesses into emergency or survival mode. Even though the government deferred the introduction of the reforms for twelve months, engagers could be forgiven for not being entirely focused on IR35.

Under normal circumstances, most people would argue that four years (2017 – 2021) is ample time to prepare for any form of change.

However, these were not normal circumstances, and IR35 has wallowed in ambiguity and controversy since its original introduction many years ago. Preparation, therefore, was unlikely to be straightforward.

Public sector investigations set the tone

In our previous article – 2021, A year of reform, we reviewed our experiences and findings following the introduction of the reforms to the private sector.

The findings were mixed, with some engagers exceptionally well prepared and others completely oblivious.

Irrespective of our findings, the one thing that has become clear since the introduction is HMRC’s commitment to the off-payroll reforms.

Even though the reforms were introduced to the public sector back in 2017, there were very few cases to base judgment or opinion on what HMRC would classify as good, bad, right or wrong.

Again, another reason for engagers to be confused or cautious about what actions to take. 

However, following the introduction of the reforms to the private sector, whether by strategy or coincidence, HMRC began to publish the results of investigations into some high profile public sector bodies.

The results were difficult to ignore.

The DWP, Home Office and the Ministry of Justice were all found wanting following IR35 investigations with eye-watering tax bills of £87.9M, £33.5M and £72M, respectively.

HMRC have subsequently followed that up with the results of an investigation into Defra, the government department responsible for environmental protection, food production and standards, agriculture, fisheries and rural communities. 

The result of Defra incorrectly determining contractors as outside IR35 in the eyes of HMRC was another hefty tax bill. This time a whopping £48M.

What does 2022 hold for IR35 in the private sector?

If these public sector examples are anything to go by, private sector businesses need to heed these ominous warnings.

Even though the government confirmed a soft introduction, promising no fines or penalties on genuine errors for the first twelve months of the legislation, this period is now almost over.

Having already gone through the IR35 investigation process with public sector organisations, HMRC is guaranteed to use the lessons learned when turning its attention to the private sector.

Initial requests for information and interviews with private sector businesses have demonstrated HMRC’s keen interest in the systems used to make status determinations, including the weighting of questions used to achieve a result. This is particularly interesting considering that the public sector organisations punished for making incorrect determinations all used the government’s own CEST status determination tool.

Additionally, HMRC questions have intimated that the scope of investigations may expand into the broader supply chain rather than focusing solely on status determinations.

Therefore, care and compliance must prevail in 2022 for private sector businesses to meet the demands of the off-payroll reforms.

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.

For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

IR35 compliance – 2021, a year of reform

In what has been a turbulent and unpredictable year, we can all be forgiven for moments of uncertainty.

However, when it came to the Off-payroll reforms, finally introduced into the private sector in April, there was an unerring certainty about HMRC’s actions.

Amid calls for a further deferral or even a complete u-turn and retraction of the reforms, HMRC remained steadfast in its determination to push through the legislation, albeit with a soft introduction.

The overall consensus was that engagers, contractors, agencies and all of those businesses within the temporary labour supply chain had received the benefit of an extra twelve months to prepare for the changes.

Although some would reasonably argue that the pandemic had distracted preparations and taken priority, the calls fell on deaf ears, and the legislation came into effect on the 6th of April.

So what have we learned?

What have we learned?

In the nine months since the introduction of the reforms, we’ve heard many stories, thoughts and ideas around how best to respond to the IR35 legislation changes. In many cases, engagers have taken an ultra-cautious approach with their new responsibilities and liability.

Umbrella companies have stepped up their pitch to promote their offering as an IR35-free solution, and contractors have had to make career and lifestyle choices that were often unwelcome or unwanted.

These reactions were not entirely unexpected, but perhaps the biggest surprise has been the number of stories and examples of businesses that remain unprepared or uncertain about the legislation.

The government confirmed a soft introduction, promising no fines or penalties on genuine errors for the first twelve months of the legislation, perhaps giving engagers a sense of security and a safety net from which to preach ignorance.

However, the critical point of the soft landing is the reference to genuine errors. Given HMRC’s guidance notes on responsibility and reasonable care, genuine errors appear quite a narrow channel that leaves a lot of other areas open to challenge.

Engagers who have made blanket statements or outsourced determination processes to avoid IR35 liability should seriously reconsider their actions to ensure they have genuinely mitigated any risk.

The soft landing is unlikely to stretch as far as protecting against complacency or ignorance.

Furthermore, we have learned more recently of HMRC’s post-reform requests for information. While the requests initially focused on determination processes, compliance and contractor numbers, subsequent interviews have led us to believe that examining the broader supply chain is highly likely.

This would likely include agencies and umbrella companies, meaning that engagers could be held responsible or deemed complicit if tax avoidance schemes are unearthed within the supply chain.

With a plethora of other tax legislation at its disposal, the Off-payroll legislation could just be a Trojan horse that HMRC will use to assess the broader temporary labour supply chain. This is particularly relevant to engagers that have forced contractors down the umbrella route.

What next? IR35 in 2022 and beyond

Compliance and care must be the keywords for engagers as we approach 2022 and beyond.

Based on the direction of HMRC’s post-reform investigations, we strongly recommend that supply chain management and due diligence become an integrated part of engagers BAU for 2022 thereon.

Given the economic impact of the pandemic over the last two years, tax avoidance is undoubtedly going to be high on the government’s agenda.

Moving contractors to umbrella models purely to avoid the Off-payroll legislation may, in hindsight, appear to be a jump from the frying pan straight into the fire.

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.


For another angle on our sector in 2021, we asked Group CEO Matt Tyson to walk us through the year and highlight some of his stand-out moments, you can read that here.

For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

Workr Group: A Year In Review

When we look back a couple of years, it was IR35 that we thought would reshape the future of businesses in our sector. But with a global pandemic and a world that has come to terms with hybrid working, companies have had to jump through a lot more hoops to make it out the other side.

For The Workr Group, this meant expanding the support we offer, partnering with industry leaders and making new hires to take our organisation to the next level. By many measures, this has made 2021 one of our biggest and most significant years yet.

We’ve asked Group CEO Matt Tyson to walk us through the year and highlight some of his stand-out moments.

1. Starting the year in lockdown

The new year arrived. We were all fired up and the team was ready to make a difference. Then, just a day later, we were back at home. Not an ideal start to 2021, especially as the Brexit transition period had just ended, and businesses were yet to realise the impact this would have on labour supply later in the year – perhaps most publicly seen in a shortage of drivers. 

But, as they do, our amazing staff took it in their stride, allowing us to hit the ground running and set the wheels in motion for the significant partnerships and key hires we’d make just a few months later. 

2. Preparing private clients for IR35 reform

Because IR35 was delayed to 2021, it wasn’t surprising that some businesses left it a little close to the deadline to get their affairs in order. This meant we spent the first few months of the year educating clients, bringing them up to speed with what the legislation meant for them.

Thankfully, we have Workr Compliance, headed up by Andy Webster. By helping clients to navigate the pitfalls of IR35, Andy and his team have grown Compliance into a genuine competitor to the more established players in this field. 

A global leading integrated financial services provider is the latest well-known client to engage Workr Compliance for support with their IR35 requirements. That is a tremendous win and proves the reputation Workr Group now has within the market.

3. Being acquired by JSA

Towards the end of April, we finalised talks to join forces with JSA. As part of the JSA Group, we’re now part of the biggest payroll group in the UK, presenting an enormous opportunity for our staff and clients.

Given that JSA didn’t have comparable business units to Workr Solutions and EasyPay, we’ve seen significant resources added to these parts of Workr already. Yves Bizimana and his growing team have been busy boosting our profile and generating revenue.

4. Helping businesses navigate Brexit shortages

It was bound to bite sometime, and in July, it did. Hospitality, construction and other sectors really started to feel the effects of the lack of new EU workers – which were laid on top of workers self-isolating and/or on furlough. 

Many of our agencies looked to us for guidance during this tricky period. One example of how we were able to assist was to help them articulate the value of our umbrella offering to potential candidates. In highlighting the many benefits of working through Workr Umbrella, our agency partners were able to better attract and retain workers. 

5. Conquering the Crystal Maze

In September, we held our long-overdue summer party, marking the start of our organisations coming together. Putting our collaboration to the test, we set about tackling the classic game show’s challenges.

This really was a great moment for me personally. Seeing the teams working together and indeed meeting face to face for the first time in 18 months was fantastic. 

6. Appointing Charles Daw to Head of International

Lastly, as if the year hadn’t been busy enough, we took on Charles Daw. With experience in everything from umbrella to international, Charles initially joined EasyPay to bring a new perspective to the business.

After a recent strategic Review of the Group, it was decided that Charles’ talents best lay in the international arena. With him spearheading the team, we expect to see incredible things, not least because the sector is constantly changing

Looking forward

Internally and externally, we’re now part of the biggest group in the UK providing services of this nature – and we’ve only scratched the surface in terms of collaboration. The summer party was just the beginning. Next, we’ll have company-wide conferences, team days and work dos.

Whatever’s around the corner, the future looks bright as we continue to innovate, collaborate, grow as individuals and strengthen our network. As long as we keep looking for the challenges, putting clients in the centre and embracing trends, the only way is up.


If you’re interested in any of the services we mentioned above, or want to know more about how we can help you, fill in our contact form. A member of the team will be in touch.

IR35 compliance – Is supply chain compliance next on HMRC’s hit-list?

Following Workr’s recent articles about HMRC’s post-reform activities, it’s been interesting to observe that much of the information requested in HMRC letters and interviews has centred around those involved in the supply chain.

In particular, HMRC appears to be focusing much of its attention on the recruitment suppliers used to source contractors and the umbrella companies used to engage them. 

Having kept a close eye on recent proceedings and spoken with businesses that have already conducted post-reform meetings and interviews with HMRC, it’s fair to say that HMRC’s questioning has been more extensive than expected.

The consensus following these meetings (some businesses have already had more than one) is that HMRC is looking well beyond the scope of the Off-payroll reforms in its investigations.

HMRC appears to be looking at the whole supply chain if its questioning and investigations are anything to go by. Requests for records of recruitment suppliers and umbrella companies have not been uncommon.

These requests lead me to believe that HMRC is looking to assess the bigger picture rather than focussing purely on the status determination process.

Are engagers responsible for their supply chain?

In the context of the Off-payroll reforms, there are two main changes in responsibility for engagers:

  1. Conducting and communicating the status determination for each contract assignment.
  2. Meeting Reasonable Care tests, as defined by HMRC. 

Upon completion and confirmation of the status determination, the responsibility for the payment of taxes etc., falls to the payee, which in most cases is the recruitment agency or umbrella company, depending on the status result.

The legislation contains little reference to the supply chain or responsibility for its management.

Why, then, is HMRC following this route of questioning?

If the early market indicators are correct and many PSC contractors have transferred to umbrella models or employment contracts, it would make sense to me that HMRC prioritises following that money trail over anything else. This is, after all, where HMRC is likely to generate its quickest wins and the majority of its revenue.

However, HMRC has a plethora of tax evasion legislation that it can use for enforcement purposes. I, therefore, believe that there is a real risk of engagers being held responsible or deemed complicit for the actions of those within its supply chain should future HMRC investigations unearth problems.

What are the risks of not managing your supply chain?

Based on the direction of HMRC’s initial post-reform investigations, it appears that supply chain management and due diligence could well be defined as being a part of the engagers reasonable care and compliance responsibilities.

In its reasonable care guidance notes, HMRC advised engagers to seek the advice and support of qualified and professional advisors, but this was as far as the advice went. Therefore, the  Off-payroll legislation contained little for engagers to fear in relation to its supply chain management.

However, given the focus that HMRC has put on the supply chain during its recent investigations, my advice to engagers is to beware.

The Criminal Finances Act is an alternative piece of legislation that HMRC has used previously and could use again in its fight against tax avoidance. There have been several cases of umbrella providers being found guilty of peddling illegal tax avoidance schemes in recent times.

Engagers found to have such umbrella companies in their supply chain could well find themselves under investigation for being complicit in promoting such schemes.

Therefore, the need for supply chain management and due diligence is essential to prove reasonable care and will go a long way to reducing any risk of complicity.

If you have concerns about meeting the requirements of the off-payroll legislation or supply chain compliance, then Workr Compliance can help.For a free, no-obligation audit and assessment of your IR35 compliance process, you can speak directly with Andy Webster, Founder and Director, Workr Compliance, on 07827 810851 or at aw@workrgroup.com.

December Office Hours 2021

We’ll be available throughout the December period but please check the following holiday hours which apply to Workr Accounting, Workr International, and Workr Umbrella:

Workr Accounting & Workr UmbrellaWorkr International
Thursday 23rd December09:00 to 17:3009:00 to 17:30
Friday 24th December09:00 to 15:0009:00 to 15:00
Monday 27th DecemberClosed Closed
Tuesday 28th DecemberClosed Closed
Wednesday 29th December09:00 to 17:3009.00-12.30
Thursday 30th December09:00 to 17:3009.00-12.30
Friday 31st December09:00 to 15:0009.00-12.30
Monday 3rd JanuaryClosed Closed
Tuesday 4th JanuaryNormal hours resume (9:00 to 17:30) Normal hours resume (9:00 to 17:30)

All the very best in this festive season and in the year ahead.

The reality of navigating compliance in another country

It’s easy to see why so many contractors end up seeking opportunities abroad. With a broader range of job roles (and salaries), we’ve seen a steady rise in talent emigrating across the globe for the last 20 years. 

But adjusting to the various tax rules and regulations of a new country is far from easy. That’s where organisations like Workr come in, helping all parties involved in international recruitment stay compliant and protect their take-home pay.

To explain this in more detail, we recently sat down with the new Managing Director of Workr International, Charles Daw. Here, he discusses his role and how his team helps support those looking for opportunities further afield.

Early days of international recruitment

I started working in the contractor management industry at a UK umbrella company. After a couple of years, an opportunity arose to join a company that focused on international contractors. I found it to be a far less transactional, more consultative and value-adding relationship with the recruitment industry. It turned out to be a great time to jump into the market.

I grew the business with agencies who were developing their international presence. Only a small number of organisations were able to offer the support that was needed at the time, and I was able to develop some great relationships. I moved from a junior sales role to become a manager, and then eventually to take up a more senior position.

Feeling like I wanted a new direction, I joined Easypay, a subsidiary of the Workr Group. Here, I was helping find funding for agencies – effectively selling a different product to the same market that I was used to. Workr Group then joined JSA Group, and with that came a greater focus on the international market. My experience made me a perfect fit for this division, and I became the Managing Director.

Simplifying international solutions

If you’re an agency based in the UK, and your end-client is based in the UK, you’d still have to consider the fact that the work might be taking place elsewhere. If it is, then the tax legislation and other legal requirements need to be applied.

For example, in Germany they have the AUG licence, which is effectively a labour leasing licence. So, if you want to lease out a contractor worker to an end client in Germany, you’ll need it. You’ll also need to consider that you can only have a maximum of three parties in the working relationship. Get that wrong and you could fall foul of German tax law.

It’s our job to know this legislation inside and out and keep all parties compliant. What’s more, we have to impart this knowledge to those we work with – at all levels. Whether we’re speaking to your CEOs or your junior agents, we explain the nuances of each country and help to avoid ending up in a non-compliant situation.

Managing relationships

To provide the support that international recruitment agencies need, there’s a lot that goes into being able to ensure a contractor or agency acts within the law. In order to stay compliant across the 90 countries we operate in, we have to work with a network of partners.

We have a strong partner network as well as our own in-house solutions. My role will be spent strengthening the partner relationships as well as increasing the size of our in-house services.

This is where we stand out from the competition: we accept our limitations and prioritise investment into finding like-minded organisations around the world. Not only does this allow us to scale faster, but it also ensures our clients get the best support available.

Taking the industry forward

As part of our responsibility to offer clients the best support available, we need to be able to forecast big changes in the industry. And one thing we see changing is a growing preference for employed solutions.

As recently as two years ago, the long-standing preference across Europe was self-employment. Today though, with increased scrutiny in almost every country, companies and contractors are far more concerned about taxation and their compliance.

It’s no surprise as we see this happening in the UK with the IR35 reform. Other countries like Germany addressed this a few years ago with new legislation, but around the EU, it has caught some businesses off guard. It’s for reasons like this that there’s been a rise in the need for compliance organisations such as ourselves and the level of our involvement in placing contractors internationally.

Seeking international tax advice and fully compliant payroll solutions?

If you’re interested in placing contractors across the globe, or could just use a little guidance on where you stand currently, we’re here to help


Just leave your details on our contact form, and a member of the team will be in touch.

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