IR35 - what you need to know
- The government will extend the off-payroll rules from the public sector into the private sector from 6 April 2020.
- Draft legislation was released on 11 July 2019, you can view it the draft legislation here and the government policy paper here. You can also read our press release response.
- Please note – the draft legislation is subject to an 8 week technical consultation until 5 September 2019. The outcome of this process may result in amendments to the draft legislation, the final legislation is expected around November 2019.
- The REC has written a brief summary of the draft legislation key changes but we will conduct a more detailed review into the legislation and compile advice for members, clients and contractors in due course. Please note, we will update the template contracts as soon as the final legislation is released towards the end of 2019.
- Guides and flowcharts below (Please note IR35 member guide - part 2, will be updated next week with further details)
- 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.
IR35 support for the 2020 changes
REC's response to consultation - Aug 2018
The REC's response to the consultation on off payroll working - a successful campaign which led to the delay in implementation
Download it here
Off payroll rules flowchart
How to prepare for the 2020 changes
Limited Company Contractor flowchart
This flowchart will help you decide which contracts to use when supplying limited company contractors in 2020
Tax Guide for Recruiters - 3rd Edition (May 2019)
Resources you may be interested in