The Government has postponed the planned changes to the off-payroll working rules (commonly known as IR35) until 6 April 2021.
The reforms would have had significant implications for medium and large companies as many self-employed individuals working for companies through their own personal services company (PSC)/loan out companies would have had to be treated as ‘deemed employees’ of the end user/client and be taxed under the PAYE regime. Engaging companies also faced potential liabilities for unpaid tax and National Insurance (as well as interest and penalties), if they made an incorrect determination or failed to comply with some of the other complex aspects of the rules.
These changes were highly unpopular with companies and contractors alike. However, only a month ago, HMRC seemed determined to press ahead. We assume this delay is another example of the extremely disruptive effect of COVID-19