Government’s draft IR35 legislation contains important changes
After much anticipation, the Government has now published its draft legislation for the off-payroll working (IR35) rules, which will be enforced in the private sector from 6 April 2020.
The latest policy document for the private sector shares a number of similarities with that already in force in the public sector.
However, it does introduce a few new changes which contractors and businesses should be aware of as they begin to prepare for the changes ahead.
It was already known that the Government intended to introduce some form of exemption for small businesses, but this has now been confirmed in the draft legislation.
This means that contractors engaged by a company classed as ‘small’ in a tax year according to the Companies Act 2006 will need to continue operating IR35 as they currently do.
The new legislation will also introduce a new term for hiring organisations to provide IR35 decisions, referred to as a ‘status determination statement’ (SDS), which must be provided by businesses to contractors.
This must include both a decision on IR35 and the reasoning behind it. Not providing an SDS will be seen as a business failing to fulfil its obligations, and thus the liability will sit with it until a suitable SDS is submitted to HM Revenue & Customs (HMRC).
To reduce the number of conflicts, the draft legislation has also confirmed that businesses will only have 45 days to consider and respond to any disagreements of a status decision with the reasoning behind their decision.
This differs drastically from the current system which allows a contractor to challenge the decision at any point via HMRC or through an appeal heard at Alternative Dispute Resolution (ADR) and/or judge at a tribunal hearing.
- The Coronavirus Large Business Interruption Loan Scheme (CLBILS)
- Latest amendments to the Coronavirus Job Retention Scheme announced
- Personal loans, credit cards and overdrafts
- Revised Coronavirus Business Interruption Loan Scheme (CBILS)
- Take care – Coronavirus fraud on the rise
- Government updates guidance on small business and retail sector grant schemes
- Government confirms that furlough rules do not leave employers at risk of breaching minimum wage rules
- Newly appointed staff members will not benefit from the Coronavirus Job Retention Scheme
- Coronavirus support for people working through their own limited company
- Holiday rules relaxed to allow annual leave to be carried over to next two years
- Suspension of director liability for wrongful trading
- Soft-landing period for MTD for VAT extended to April 2021
- The Coronavirus Jobs Retention Scheme and employers’ National Insurance and Pension contributions
- What expenses are taxable when working from home?
- Preparations Checklist
- Coronavirus Business Interruption Loan Scheme (CBILS)
- Business rates relief extended
- Layoffs owing to reduced work
- Coronavirus Self Employed Income Support Scheme (SEISS)
- Tax and Companies House Deferrals
- Companies House Filing
- Personal Finances
- Working from home
- Commercial Rent Deferrals
- Coronavirus Job Retention Scheme Guidance Published
- Coronavirus Self Employed Income Support Scheme (SEISS)
- Accessing the Coronavirus Job Retention Scheme
- Important Message to Clients and Friends
- Payroll professionals confirmed as key workers
- Accessing the latest COVID-19 stimulus
- Inn Control Here to Help
- COVID19 - Further Update
- COVID19 Update: 18 March 2020
- COVID-19: Government Measures to Assist Small Business Experiencing Financial Hardship
- Budget 2020
- Entrepreneurs’ Relief changes expected in March Budget
- Get ready for a range of tax changes this April
- VAT zero-rating now applicable to businesses e-publications
- Latest case highlights the dangers of not meeting workplace pension requirements
- When was the last time you checked your NIC record?
- Property tax implications of getting divorced
- Make the most of the Brexit implementation period
- More than 3,000 taxpayers complete self-assessment on Christmas Day
- Should your company pay a data protection fee?
- SMEs now wait 23 days for late payments, new study finds
- Reminder: National Living Wage set to increase from April
- HMRC launches revamped CEST IR35 off-payroll working tool
- New Advisory Fuel Rates
- VAT receipts reach record level of £133 billion
- Around half of the UK’s SMEs admit to making errors on taxes
- Late payments a huge drain on SMEs
- The end of the help-to-buy ISA – What’s next?
- HMRC urges taxpayers to be vigilant ahead of self-assessment deadline
- Keeping workplace gifts tax-free this Christmas
- Annual R&D spend in the UK reaches £25 billion
- Countdown to the 31 January Self-Assessment Tax Return deadline begins
- Grant scheme opportunities for electric vehicle charging infrastructure at work
- Spanish holiday home owners cautioned over post-Brexit tax impact
- Businesses and contractors offered clarity on IR35
- Pension holders to be refunded £54 million of overpaid tax
- Newly cohabiting parents warned over new tax charge
- HMRC trialling self-assessment checks to help local authorities to recover council tax
- Overseas employees potentially face double NICs liability following a no-deal Brexit
- New figures show a sharp increase in Inheritance Tax (IHT) receipts
- Non-VAT-registered businesses need EORI number to trade with EU customers and suppliers post-Brexit
- 25,000 companies receive penalties for the late filing of accounts in just one month
- HM Revenue & Customs has started carrying out PAYE tax investigations remotely
- Wages rise at the fastest rate in a decade
- Renovated homes that have been empty for two years can qualify for a reduced rate of VAT
- Government delays introduction of VAT reverse charge!
- Making a voluntary disclosure to HMRC
- MTD for VAT filing deadline missed by one in ten businesses
- Boots, Asda and Specsavers push back against business rates
- Half of all SMEs make VAT return mistakes
- Tax investigations reap in £13 billion for the treasury
- How to tell if an email is fraudulent
- Government’s draft IR35 legislation contains important changes
- Construction businesses only have weeks left to prepare for the VAT reverse charge
- HMRC outlines changes to Capital Gains Tax treatment on second homes
- Summer childcare costs cooldown with Tax-Free Childcare
- Employment Allowance to be restricted from next year
- Principal Private Residence Relief and Lettings Relief changes due in April 2020
- New figures show that a quarter of estates paying Inheritance Tax (IHT) are investigated by HMRC
- Wealthiest UK families save nearly £700 million a year in Inheritance Tax
- Taxpayers’ bills delayed by payment on account errors
- SMEs unaware of £1 million annual investment allowance
- Businesses encouraged to increase readiness for no-deal Brexit
- Value of UK SMEs reach £3 trillion
- More than 150 chief financial officers and senior finance executives personally fined by HMRC last year
- Remember to pay the annual data protection charge
- Incorporation no longer automatically resets the two year requirement for sole traders
- Government confirms that HMRC will get a higher priority when firms go bust
- MTD for VAT - relaxation on posting supplier statements
- Significant lack of awareness around gifting rules for IHT
- EIS and SEIS tax relief funding passes £2.1 billion
- New code launched to help protect victims of sophisticated banking fraud
- Revenue tests new trigger to increase the accuracy of PAYE codes
- Pass on up to £950,000 tax-free in 2019-20
- Beware the Employer Compliance Check Questionnaire