IR35: What does it mean for UK marketing agencies?

Author Sam Wheeler

Ir35

​To say that the marketing industry is a competitive one might just be the heaviest understatement I can think of, off the top of my head.

Coming from a recruiter – one of the most saturated markets in the United Kingdom – that’s saying something; but with over 250,000 marketing agencies in this country, from tiny boutiques to conglomerate businesses, the new IR35 legislation coming in to play soon has left many of us scrambling to get a hold of understanding and preparing for it as such.

Contract recruitment for the marketing industry is a large part of what we do here at Certus, so with questions now coming up almost daily (from clients and candidates alike), we thought it couldn’t hurt to put out some answers to the most common questions we’re getting and shed some light on this decidedly grey-area pesky piece of work.

What is IR35?

Put simply, IR35 is legislation which has been written to combat tax and national insurance avoidance. It’s an off-payroll rule which applies to ‘workers’ – read: contractors and freelancers – who supply their services via a ‘third party’ – read: limited company – who would otherwise be classed as an employee.

Sound confusing? It sort of is, hence the chatter surrounding it. But, rest assured, it only applies to medium and large businesses – those under 50 employees need not worry.

When is it happening?

The changes to the original legislation will be enforced from April 2020.

Unbeknownst to some, the original IR35 legislation was actually put in place in the year 2000 – and has had its fair share of criticism ever since. Taking its name from the then Inland Revenue, the IR35 has even been deemed ‘unenforceable’ by HMRC itself – catalysing the changes we’re now seeing.

And, of course, the all-important question:

What does it actually mean for UK marketing agencies?

In a nutshell? It could mean a significant commercial impact to your business, with few opportunities to circumnavigate it.

The conversations I’m having on the daily with my clients go something like this:

- If your current contractors/freelancers do appear to fall inside the IR35, could there be a way to have them fall outside of the law by tweaking their working hours or arrangements (offering they work remotely, or reducing their hours, for example)?
- Could there be an opportunity for them to become a bonafide employee who belongs on the payroll? Is this something the business has considered/could make room for?
- Start your research now – with so much info online, there’s no excuse to wait the next couple of months out before beginning to compile your knowledge on what really could be a hugely impactful change to the way your business and its workforce operates.

Remember, like most things, there’s a lot of grey area with the IR35 (ironically, the resolving of which being the reason for its changing this year); who does and does not fall under the IR35 umbrella comes down to ‘tests of employment’, basically the government’s way of determining what is and isn’t ‘deemed employment’.

If there’s one thing for sure, it’s that the marketing world is an exciting place to be – and, really, if any industry is equipped to deal with change surely it’s this one? The innovators, creatives, thinkers of the corporate world – the adaptable businesses who embrace change like an old friend, with a smile on their face and a coffee to hand.

Whilst we’re sure it hasn’t been designed to make anyone suffer, just the worm hole of legislative terms and jargon alone can send one off into a spin – which is why we do what we do. The fact is, you might need to re-strategise and revise the internal hiring plans you had – and we’re here every step of the way. You might need to learn more about IR35, before realising that actually everything can continue as is – in which case, we’re loving the work we do and can’t wait to continue doing so.

As recruitment consultants here at Certus – consultant being the operative word – we’re more than someone who sends the odd CV your way and manages interviews around your hectic diary. We’re sounding boards to many, the voice of reason for some – and a friendly face to have a moan to, usually about things like the IR35, for more than a few.

We do things differently.

To talk through any of the above or otherwise, our specialist marketing team is all ears – get in touch with our London office on 0203 758 7890.