IR35: Timing change

The Government’s announcement today regarding the upcoming off-payroll reform will no doubt be welcomed by clients all over the country struggling to prepare in time.

Changing the implementation to only affect services delivered on or after 6th April 2020, rather than payments as per the original draft, means clients can switch to PAYE contracts just prior to that date, or issue an outside SDS without worrying about when the payments for work will fall.

This will no doubt be welcomed by contractors who can have certainty that all work up to the 5th April 2020 can be paid under the current rules, removing the uncertainty created by the previous rules.

I wrote a piece on the timing last week for the very reason it seems HMG has now changed things - every client and contractor I spoke to was concerned about when they would need to make changes and this varied depending on payment cycles, meaning some contracts must be changed in January and some not until the start of April. All of that confusion has now been removed.

All services delivered on or after April 6th will need to be assessed by the end client, regardless of when the services are paid for. This provides time to issue and agree a new contract and any determinations would need to be received, at the latest, during the week of 30th March. For those not continuing the last day of work under the old rules, the deadline would be 3rd April.

It’s great to see that at least this element of the reform has been clarified making it easier to implement. I wonder whether this is being influenced by the fact the Government review is unlikely to be completed by the deadline being used when the rules referred to payments, rather than services. Could this be an omen that there’s more to come from the full review?

Either way, it is clear that businesses need to prepare - having more time is great, but only if it is used. Putting off IR35 prep for another month will just leave clients in the same place as before, the extra time should be used to properly prepare.

Get in touch

Putting off IR35 prep for another month will just leave you in the same place as before, the extra time should be used to properly prepare. If you would like more information about how our assessment approach, backed by insurance, can help your business, please contact me as soon as possible

Jeni Howard

Head of Compliance

View Profile