COVID-19. Government announces IR35 reforms postponed for 12 months

Changes to off payroll working to come into effect on 6 April 2021

Please note: This information may now be out of date.

The Government have announced the postponement of the introduction of the reforms to off-payroll working rules (IR35).

The reforms have been delayed by 12 months as part of the government’s Covid-19 economic response package. They were due to come into force on 6 April 2020, the revised date is now 6 April 2021.

Jesse Norman, Financial Secretary to the Treasury commented on the move:

‘We will do whatever it takes to support the British economy through Covid-19.That is why, as well as the current support measures we have announced, we have delayed the off-payroll working reforms to April 2021’

The reforms aim to make employers in the private and third sector (eg charities) responsible for determining the tax status of contractors and ensuring that the right employment taxes are paid. The reforms have previously been implemented in the public sector.

The introduction of the off payroll working reforms would mean a significant change for employers and contractors. Recognising this and in the context of the COVID outbreak, the government took the decision to postpone the date of reforms for 12 months.

The new introduction date will be legislated in the upcoming Finance Bill.

If you have any questions on the new rules please contact us.

Further information:

Detailed guidance on the reforms is available and has been published by HMRC

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