The Government will extend the off-payroll rules from the public sector into the private sector from 6 April 2020. We have created this IR35 hub to bring together all REC resources to help you navigate these changes. Whilst we do not have draft legislation at the moment (expected summer 2019) the Government has set out its proposals in a consultation document (consultation open to 28 May 2019). Meanwhile, members may use the guide Extension of the off-payroll rules into the private sector (2nd edition) to explain the changes to both clients and contractors (the guide is an introduction only and clients and contractors should get their own legal advice). We will run a series of IR35 webinars and seminars throughout 2019 and into early 2020. We recommend attending a seminar as early as you can so that you have enough time to implement the necessary changes to your payroll and other processes. We will update our model contracts in time for the changes. For other Tax matters please see our guide to employment tax issues for recruiters.
Tax avoidance schemes: In anticipation of the changes some intermediaries may approach recruitment businesses with ‘solutions’ to the changes. Some will be legitimate, others won’t be. HMRC have issued a number of Spotlights about schemes used to reduce temporary workers’/ contractors’ tax and NICs and which HMRC considers do not work. These include paying contractors via loan (now subject to the loan charge), annuity and loyalty points for advertising the contractor’s services on a jobs board. When engaging with any intermediary, members should fully understand the arrangements used to pay those temporary workers/ contractors.
How should status decisions be passed through the supply chain?
The REC's response to the consultation on off payroll working - a successful campaign which led to the delay in implementation
How to prepare for the 2020 changes
This flowchart will help you decide which contracts to use when supplying limited company contractors in 2020