Reed Talent Solutions is pleased that the government has followed through on their pre-election commitment to conduct a review of IR35. This new review targets the implementation of off-payroll working rules into the private sector in April 2020 for a smooth transition.
Chancellor of the Exchequer Sajid Javid says that the government is on the side of self-employed people - the review looks to protect those self-employed individuals who fall outside the rules’ scope.
However, given the short timeline between now and April, we would question how effective this review could be. HMRC says it will implement the changes in April ‘come what may’ – despite what they find.
There is a concern among contractors that the new changes don’t go far enough – it was revealed that the review will be about the implementation of the reforms rather than the reforms themselves.
A pressing concern for us, with the Chancellor’s budget announced for 11 March 2020, is when we will get the final legislation which is key to preparations? There is still no clarity around how contract workers can prepare for these changes, other than deciding if they are required to adhere to the new rules. Certain criteria have been released - small businesses are exempt, but any business with a yearly revenue of £10.2m or more must comply.
IR35 will shift responsibility for determining the tax status of a contractor from the worker themselves to the organisation using their services. The off-payroll legislation is intended to ensure that individuals who work like employees pay broadly the same employment taxes as employees.
Reed Talent Solutions can provide businesses with a broad and clear understanding of IR35 and how to mitigate risk and plan for the reforms. Preparing for IR35 is so important, find out why by contacting us now.