In an attempt to protect businesses who are struggling in the COVID-19 pandemic, the government has announced that it is to delay the implementation of the changes to the off-payroll working legislation commonly known as IR35. These changes were due to be introduced on 6 April 2020 and would have extended the regime that was introduced for the public sector in 2017 to medium and large private sector employers, including those in the private health and social care and housing sectors. However the changes will not now be implemented until 6 April 2021.

The main change for the public sector was to have been the introduction of the requirement to issue a status determination statement (SDS) in relation to all workers providing services via a “relevant intermediary” (usually a personal services company, or PSC). Although this will now not be required for at least a year, public sector employers will still be required to determine the employment status of any such worker, and ensure that tax and NI is deducted from payments made to anyone falling within IR35. We would recommend that status checks are done using the HMRC “check employment status for tax” (CEST) tool. 

For further information on how this issue might affect your organisation, please contact Laura Horovitz, Sarah Parkinson, Raj Basi or Andrew Uttley.

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