Government launches review into IR35
The government has launched a review of changes to off-payroll working rules to address any concerns from businesses and affected individuals about how they will be implemented.
The review into the implementation of changes to the off-payroll working rules will determine if any further steps can be taken to ensure the successful implementation of the reforms, which are due to come into force on 6 April 2020.
“We recognise that concerns have been raised about the forthcoming reforms to the off-payroll working rules,” said Financial Secretary to the Treasury Jesse Norman.
“The purpose of this consultation is to make sure that the implementation of these changes in April is as smooth as possible.”
According to the government, the review will also assess whether any additional support is needed to ensure that the self-employed, who are not in scope of the rules, are not impacted.
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, announced in the 2018 budget, are designed to tackle non-compliance with off-payroll working rules by making medium and large organisations in the private and third sectors responsible for determining the tax status of contractors. The review will focus on the implementation of these reforms.
The government has also announced a separate review to explore how it can better support the self-employed. That includes improving access to finance and credit, making the tax system easier to navigate, and examining how better broadband can boost homeworking.
The review, which will conclude by mid-February, will engage with affected individuals and businesses on their experiences of the implementation of these reforms.
As part of the review, the government is scheduled to hold a series of roundtables with stakeholders, representative of those affected by the reform, including contractor groups and medium and large-sized businesses, to understand how the government can ensure smooth implementation of the reforms.
The government added that in parallel to the review, HMRC will continue its program of education and support activities, proactively helping customers to prepare for the reform to off-payroll working rules in April 2020. This will include one-to-one engagement, webinars and workshops alongside targeted communications and support for customers, and their representatives to help them prepare for implementation on 6 April 2020.