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IR35 changes to face impact review

9 January 2020

Business Tax

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In late 2019 we discussed the upcoming changes to IR35 which will impact the private sector. These changes aim to ensure that certain individuals are unable to commit tax avoidance by presenting themselves as freelance contractors rather than employees of a company.

However, due to the controversial nature of these rules the government have opted to conduct a review prior to implementation, which will be concluded by mid-February 2020.

Who will be involved in the review?

The review will focus on those who could be most affected by the new rules, both individuals and businesses. Many genuine contractors have voiced fears that the new rules could result in them being forced to hand over more tax, whilst earning less as an ‘on-payroll’ employee. It is anticipated that some contractors will have to return to full time employment and in some cases face losing their jobs entirely.

What will the review aim to do?

The review aims to see how such results as those mentioned above can be mitigated once the changes come into play in April 2020. There will also be a separate review to see how the self-employed can be supported by the government going forward.

What happens next?

There has been a call for the changes to pushed back in light of the review but only time will tell if these calls will be heeded by those in charge, until then we await the result of the review.

In the meantime if you have any concerns surrounding your tax position as an off-payroll employee please contact our tax team by submitting an enquiry.