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Recently launched IR35 review to conclude next month

The government has launched a review of the changes to the off-payroll working rules, to determine if more can be done to ensure a successful implementation of the reforms.

The review is to make sure the implementation will be "as smooth as possible"
The review is to make sure the implementation will be "as smooth as possible"

The review, announced yesterday (January 7), will address any concerns from businesses and affected individuals about how they will be implemented.


It will also assess whether any additional support is needed to ensure that the self-employed, who are not in scope of the rules, are not impacted.


Off-payroll working rules, known as IR35, were introduced in 2000 to ensure that someone working like an employee, but through a company, pays similar taxes to other employees.


The reforms, announced in the 2018 budget, are designed to tackle non-compliance with off-payroll working rules by making medium and large organisations in the private and third sectors responsible for determining the tax status of contractors.


The review will focus on the implementation of these reforms, which are due to come into force on 6 April 2020.


The government will launch a separate review to explore how it can better support the self-employed. That includes improving access to finance and credit, making the tax system easier to navigate and examining how better broadband can boost home-working.


The announcement fulfils a commitment made by Chancellor Sajid Javid on November 30 last year.


Financial Secretary to the Treasury, Jesse Norman, said: “We recognise that concerns have been raised about the forthcoming reforms to the off-payroll working rules.


“The purpose of this consultation is to make sure that the implementation of these changes in April is as smooth as possible.”


The review, which will conclude by mid-February, will engage with affected individuals and businesses on their experiences of the implementation of these reforms.


As part of the review, the government will hold a series of roundtables with stakeholders representative of those affected by the reform, including contractor groups and medium and large-sized businesses, to understand how the government can ensure smooth implementation of the reforms.


It will also carry out further internal analysis, including evaluation of the enhanced Check employment status for tax (CEST) tool and public sector bodies’ experience of implementing the reform to the off-payroll working rules in 2017.


The off-payroll working rules do not affect the self-employed, as only those working like employees are in scope. As part of the review, the government will explore whether there are any further steps it could take to support businesses in correctly determining employment status.

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