IR35 is tax legislation that was introduced in July 2000 to address tax avoidance by individuals supplying their services through an intermediary (such as a Personal Service Company) who may not be paying the appropriate levels of employee income tax and national insurance contributions.
Following the government’s decision in early 2020 to delay the implementation of the reforms to the off-payroll working rules (known as IR35) due to the Covid-19 impact, the legislation will now take effect from April 2021.
Today it is the contractor who is responsible for deciding if the IR35 Rules will apply to their engagement.
From 6th April 2021, the responsibility for determining the employment status of engagement will shift to the Hirer or end Client.
This means that Clients will need to decide on the IR35 status of an assignment and the determination will be one of Inside or Outside IR35.
With many organisations already preparing their businesses for the revised implementation date, we would strongly advise that if you are working through a personal service company, that you begin dialogue with your consultant and client contact now.
Staffing 360 Solutions have a comprehensive understanding of the legislation and we welcome an opportunity to help you navigate your way through the pending changes.
Understanding Off-Payroll working (IR35)
Check Employment Status for Tax (CEST tool)
Navigating through the CEST tool
Useful information about checking employment status
Understand the background to IR35 and what this means for you as a contractor