IR35 OFF-PAYROLL WORKING RULES DELAYED UNTIL 6TH APRIL 2021

Some much-needed good news was announced yesterday that the Government has delayed the IR35 off-payroll working rules for 12 months.

Steve Barclay, the chief secretary to the Treasury said:

“I can also announce this evening, madam deputy speaker, that the government is postponing the reforms to the off-payroll working rules, IR35, from April 2020 to the 6th April 2021.

Government will therefore not move the original resolution tonight but will shortly table an additional resolution confirming that we will reintroduce the off-payroll working rule provisions by amending the bill, with a commencement date of 6th April 2021.”

This is a deferral in response to the ongoing spread of COVID-19 to help businesses and individuals.

This is a deferral, not a cancellation and the Government remain committed to reintroducing this policy to ensure people working like employees but through their own limited company pay broadly the same tax as those employed directly.”

This decision was taken due to significant pressure from contractors and campaigners after the recent coronavirus outbreak, as those deemed ‘inside IR35’ and having to self-isolate would see a dramatic loss in pay.

WHAT DOES THIS MEAN FOR RECRUITMENT AGENCIES NOW?

This is good news for recruiters as it will give agencies more time to prepare for the new rules in April 2021. This will enable the industry to focus on placements and growing their business in a time of uncertainty.

If you need any further information or IR35 guidance on how the IR35 rule will affect your recruitment business, please do not hesitate to contact our office.

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