The Impact Of IR35 Changes On The Technology Sector

As we know, upcoming IR35 changes are estimated to have an impact on over 900,000 UK based limited company contractors working in the private sector. As an industry heavily reliant on contractors, the technology sector and its freelancers are likely to feel the brunt of this impact. The question we ask is, what will be the true impact of IR35 changes on the technology sector, and do these changes really mark the end of the IT contractor?

The impact of IR35 changes on the technology sector

There are still 5 months to go before IR35 changes come into play. However, as businesses begin to prepare for upcoming changes, the technology sector is already starting to feel the effects.

The Office For National Statistics recently reported that in 2018 there was a  2.4% drop in IT contractors compared to the previous year. Although this drop cannot be wholly attributed to IR35 changes, the legislation is guaranteed to have contributed to some of those leaving for umbrella companies or permanent roles. The consequence of this is that some IT projects have already been delayed while future projects may face further delays due to a lack of contractors. 

Adding to the uncertainty, large scale organisations such as banks have already stated that they will no longer be using contractors who provide services via a personal services company, limited company, or other intermediary as a direct result of IR35 changes. A blanket decision such as this directly hits IT contractors, and indeed those in other sectors, further increasing the impact of IR35 changes.

With statistics and case studies such as those listed above, it is no wonder that technology contractors, and indeed the companies that rely on them, are becoming increasingly concerned over the impact of IR35 changes. This needn’t be the case. 

IR35 Compliance and Protection For IT Contractors

Optimus Shield offer a bespoke IR35 service that:
  • Determines the IR35 status of a contract.
  • Produces the government required status determination statement.
  • Offers an end to end payroll process for all eventualities.
  • Is supported by both legal and tax opinions.
  • Includes comprehensive insurance cover to mitigate all risk from your supply chain.
  • Provides personal protection insurance for the contractor in the event of any HMRC investigation.

By offering this bespoke service, Optimus Shield can protect and mitigate all risk to the supply chain, minimising the impact of IR35 changes on the technology sector and its contractors.

Optimus Shield can ensure that IR35 compliance doesn’t mean the end of the IT contractor and avoids the blanket decisions that we can see being executed across the banking sector. 

Find out more here or request a call back below to see how our IR35 service can help your business prepare for changes due in April 2021.


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Optimus Shield is the result of heavily invested research and development to tackle the issues now facing the private sector due to changes to the IR35 legislation being rolled out in April 2021.