IR35 and off-payroll working – What is it and how is it changing?

In this 90 minute session Rebecca Seeley Harris, a leading expert on employment status, will take you through the upcoming reforms to off-payroll working (IR35). On 6 April 2021, the off-payroll working rules are changing. The original IR35, the intermediaries legislation, was enacted in 2000 and meant that the limited company contractor had to self-assess whether they were employed or self-employed for tax purposes. If they were considered to be a ‘deemed employee’, they would have to pay tax as an employee.

In 2017, the new off-payroll working rules were brought in to the public sector. On 6 April 2021, the reforms to the off-payroll working rules (OP21) will be brought in in the private sector. From April, medium and large sized companies will have to comply with the new rules and the main change is that the end client will make the assessment of whether someone is inside or outside of IR35 i.e. employed or self-employed for tax purposes. Small companies, however, will continue to use the IR35 regime, which is why it is important to differentiate between IR35 and OP21. So, it will be for the contractor to self-assess under IR35 as they do now.

These changes are complicated and it is essential that the contractor and small businesses understand how the new rules work and how to prove that they are in business on their own account.

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