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Changes to IR35 delayed by 12 months

25 March

Changes to IR35 delayed by 12 months

As a result of the coronavirus pandemic, the UK Government has announced that the revised IR35 rules will be delayed until April 2021.

The Government have made it clear that the deferral is a response to the COVID-19 crisis, in order to help businesses and individuals, this is not a cancellation.

The purpose of the overhaul to the rules was due to non-compliance, which is due to cost the Exchequer over £1.3bn a year by 2023-24 if not addressed.

In order to tackle this issue, the key changes that were to be introduced from 6 April 2020 were:

  • A requirement for the employer to give a status determination statement, including reasons, as to the worker’s deemed employee status, before the start of the contract.  This is a shift of responsibility from the worker to the employer;
  • A requirement to implement a client-led disagreement process; and
  • Widening the definition of “public authority” to catch companies connected with public authorities but that are not wholly owned by one or more public authorities.

The announcement to delay the changes to the IR35 rules has been welcomed by workers in the UK.

If you need any advice on your contractor/consultancy agreements, please call Charlotte Higgins on 0114 249 5969.