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Consultation on Changes to Off-Payroll Working Rules From April 2020

Government consultation on off-payroll working (IR35) rules effective from April 2020. Words by Adam Bernstein

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Off-Payroll Working Rules
Off-Payroll Working Rules

HMRC is consulting until 28th May 2019 on the detail of how the off-payroll working (IR35) rules will apply to medium-sized and large businesses in the private sector from April 2020.

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New information requirements will ensure sharing of status determinations down the labour supply chain and give off-payroll workers and fee-payers the right to request the reasoning behind status determinations made by engagers.

The move follows the introduction of reformed rules to public sector organisations from April 2017, making engagers responsible for determining whether the off-payroll rules apply to each engagement.

The government announced its decision at Budget 2018 to proceed with the introduction of the rules to the private sector, following an initial consultation held between May and August 2018.

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From April 2020, where an individual is engaged by a medium-sized or large business and works through a company, the business will become responsible for assessing the individual’s employment status.

If the rules apply, the business, agency or third party paying the individual’s company will be responsible for deducting income tax and NICs through PAYE, as for employees, and paying employer NICs.

Looking for more business advice? Read our guide to end of year taxes here.

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