2020 in letters

New ‘Off Payroll Working Rules’ and HMRC responsibilities

IR35 is a piece of legislation originally introduced in 2000 to ensure those individuals hired by a business, who would ordinarily be deemed ‘employees’ - if they had been engaged directly - broadly pay the same amount of tax and National Insurance as employees.  Businesses for many years have always been obliged to undertake the ‘self-employment v employed’ test but IR35 specifically fell on the individual (worker) who provided their services through an intermediary (e.g. through another a company) to another person or entity. 

Unfortunately, HMRC do not believe the rules have been followed, resulting in lost income to the Treasury and unfairness, and from April 2017 new legislation was introduced that meant the public sector engaging with a worker became responsible for determining the status of the worker, and from April 2020, this same rule will apply to medium and large private businesses too.  Essentially, the criteria for IR35 hasn’t changed, but who the obligation falls upon to assess and report it has.

For those businesses who fall into the medium/large category i.e. two or more of the following: £10.2 million+ turnover, £5.1 million+ balance sheet, 50+ employees, this will mean undertaking a very close assessment of  those working on behalf of the business and vice versa. There are added complications too in the way the financial year and calendar year figures are calculated.

To help guide you through this new legislation, Armstrong Watson LLP and Solomons Europe invite you to a breakfast event where tax and payroll experts will discuss the new “off payroll working rules”/IR35 on Tuesday 19th November at Energus in West Cumbria.

Who should attend and why?

  • Personal Service Companies or individuals who view themselves as self-employed;Why? – you need to understand the new rules and if working for a company that is medium or large appreciate the checks  they will need to do.
    • Businesses – medium and large (as per Companies Act if incorporated and those with a turnover of more than £10.2m in a calendar year if not incorporated)
    • Why? You need to be aware of your new obligations and understand what help is available to you.
  • Smaller businesses that are seeking to grow;
    • Why? These new rules might not impact you now, but may in the future.
  • Anyone who engages with workers/contractors/PSCs/agencies etc.
    • Why? Because this legislation may affect you.  You need to know what it is and whether it does or doesn’t impact you.

For further information and to register your attendance at this event please email events@armstrongwatson.co.uk

For further information and to register your attendance at this event please email our events team using the link below.

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