IR35 remains a key consideration for hiring heads across the UK, particularly within accounting, audit and tax where contractors are frequently engaged for specialist or project-based work. The legislation is designed to determine whether a contractor should be treated as an employee for tax purposes, helping to prevent disguised employment.
Following the off-payroll working reforms, responsibility for determining IR35 status now sits with the end client. This has increased accountability for hiring organisations and placed greater focus on how contractor roles are defined and managed. As a result, many businesses are reviewing their approach to contractor engagement and the wider IR35 impact on hiring.
The impact of IR35 on hiring decisions
The impact of IR35 is felt both financially and operationally. Where a role is assessed as inside IR35, additional costs such as employer National Insurance contributions and payroll administration can increase overall spend.
At the same time, a cautious or blanket approach to determinations can reduce access to experienced contractors. This can limit flexibility within finance, audit and tax teams and make it harder to secure specialist skills at short notice. In practice, IR35 considerations can influence budget planning, approval processes and time-to-hire, particularly where internal processes are not clearly defined.
Understanding IR35 rules in practice
Compliant contractor engagement requires careful consideration of how roles are structured and how work is carried out in practice. IR35 rules focus on the reality of the working arrangement rather than job titles or contract wording.
Key factors such as control, substitution and mutuality of obligation all play a role in determining employment status. Roles that are heavily supervised or closely integrated into the business are more likely to fall inside IR35, whereas clearly defined project-based assignments may support an outside IR35 assessment.
For hiring managers, this creates an additional layer of responsibility when designing roles and managing contractor relationships, alongside ongoing delivery pressures.
Managing the IR35 impact on hiring
There are several practical steps organisations can take to manage the IR35 impact on hiring more effectively.
Early role assessment is essential to identify potential IR35 risks before engagement begins. Where appropriate, independent reviews of status determinations can provide additional assurance and consistency.
Clear documentation of roles, responsibilities and deliverables also helps support compliant contractor engagement. In addition, maintaining consistent communication with contractors from the outset can reduce ambiguity and improve alignment on working arrangements.
Taking a structured approach to IR35 compliance helps reduce risk while maintaining access to specialist contractor talent across accounting, audit and tax functions.
How Sheridan Maine can help
At Sheridan Maine, we support hiring heads in navigating the contractor market with confidence. As specialists in accounting, audit and tax recruitment, we understand the challenges IR35 presents and the impact it can have on hiring strategy.
We work closely with organisations to advise on role design, market conditions and appropriate engagement models. Our consultants also provide guidance on IR35 rules, helping clients structure assignments in a way that balances compliance with access to talent.
Whether recruiting permanent, interim or contract professionals, we act as a trusted partner in securing the right people while managing risk effectively.
Speak to our team
If you would like to understand how IR35 is affecting your hiring plans, we can review your current approach and discuss practical ways to reduce risk, improve consistency in determinations and maintain access to specialist contractors.
With a clear understanding of IR35 rules and a structured approach to contractor engagement, organisations can manage compliance effectively while ensuring hiring decisions continue to support business needs.
If you’d like to explore this further, get in touch today.
