UK: IR35 – Government to review the proposed changes to the off-payroll working rules

The off-payroll working rules, known as IR35, were introduced in 2000 to ensure that someone working like an employee, but through a company, pays similar taxes to other employees.

The reforms are designed to tackle non-compliance with off-payroll working rules by shifting the responsibility for determining the tax status of contractors to medium and large organisations in the private sector who are using their services. They are due to come into force on 6 April 2020. Similar rules have been in force for the public sector since 2017.

The review will run until mid-February and will consider whether any further steps are needed to ensure the new rules are implemented smoothly.

Practical point

What is clear from the Government’s announcement is that the review is focussed on the implementation of the planned reforms. There is no suggestion at the moment of any delay or change of course by the Government. It seems likely that the rules will come into force as planned on 6 April 2020 and businesses should continue to prepare for the changes.

Government Review

For more inforamtion, see IR35 – Government to review the proposed changes to the off-payroll working rules.