0370 270 6000

already registered?

Please sign in with your existing account details.

need to register?

Register to access exclusive content, sign up to receive our updates and personalise your experience on brownejacobson.com.

Privacy statement - Terms and conditions

Forgotten your password?

IR35 changes - six months and counting...

27 August 2019

In his 2018 Autumn Budget, the then Chancellor, Phillip Hammond, announced a significant change to the way liability for IR35 breaches will be dealt with for private sector companies from April 2020.

IR35 applies when a self-employed individual contracts with a client via a limited company. The client pays the limited company and in turn the limited company pays the individual. One of the benefits of this is that it typically attracts less tax. HMRC is therefore keen to make sure people using IR35 are genuinely self-employed and are not “disguised employees” using the system to reduce their tax burden.

With effect from April 2020, mirroring a change that has already been implemented into the public sector, it will be the responsibility of the end user to determine. In reality this means carrying out an assessment as to whether a contractor you are working with is genuinely self-employed.

That change is coming up quickly on the horizon…

We’re now just 6 months away from that change coming into force and, if you’ve not taken steps already, now is the time to review your existing arrangements with any contractors you work with.

It is important to audit your use of contractors generally, whether they operate via a limited company or not. This is not just a question of looking at what the contract says. This is important; but the “day to day reality” of the relationship is the most important consideration.


Next steps

IR35: Verify - find out how we can help >

Related opinions

The frontier worker permit

All EU citizens who were not residing in the UK by the end of December 2020 and want to live and work in the UK from 1 January 2021 must apply for a visa as a result of Brexit.

View blog

The UK - India migration deal

The Young Professionals Scheme will make it easier for young Indian citizens and young Britons to access visas.

View blog

Home Office Central Registry for modern slavery statement goes live - first universities publish statements

The Home Office recently launched a central registry for modern slavery statements. A growing number of educational organisations, including a number of universities, have published statements on the registry.

View blog

Moratoriums

The new Part A1 moratorium was introduced partly in response to the Covid-19 pandemic and its impact on businesses. The moratorium is not intended to be used to simply delay the inevitable insolvency of a company, but rather to allow breathing space for that company to restructure and/or achieve an effective rescue.

View blog

Mailing list sign up

Select which mailings you would like to receive from us.

Sign up