“A review of the tax rules around intermediaries – known as the IR35 tax rule - and problems with implementation of the Loan Charge.”
The Labour party manifesto made no explicit reference to IR35 but Labour’s shadow small business minister, Bill Esterson initially advised that the party would abolish the extension to the reforms should they be elected. He has since retracted this statement but confirmed that there would be a review of the current plans to roll out IR35 legislation to the private sector.
The Chancellor of the Exchequer, Sajid Javid has confirmed that the Conservative party will review IR35 should they be re-elected. He stated:
“I want to make sure that the proposed changes are right to take forward.
We’ve already said that we’re on the side of self-employed people. We will be having a review and I think it makes sense to include IR35 in that review.”
IR35 was initially introduced back in 2000 and is an anti-tax avoidance rule that aims to bring taxes for contractors and freelancers in line with that of employees should they not fit HMRC’s definition of being self-employed. IR35 reforms were implemented in the public sector back in April 2017 and the proposal was that it would be extended to the private sector from April 2020. Companies that are classed as ‘small’ in the private sector are not subject to the new rules.
CIPP comment
The CIPP Policy team sit on the IR35 forum and value hearing feedback and views from our members. Please don’t hesitate to contact us at Policy@cipp.org.uk so that your opinions can be heard.
Payroll professionals should still prepare for the upcoming reforms to IR35 in April 2020. The CIPP is running both a webinar and a training course to help individuals on the subject. The webinar can be accessed here and to apply for the half day training course, please click here.
Back to Contents
Advice to businesses is to continue preparing for IR35 reforms in April 2020 5 December 2019
As previously reported in the CIPP’s News Online, many of the political parties have pledged to review the proposed legislative changes to IR35 ahead of the general election . Experts have advised that, despite these pledges, organisations should continue their preparation for the IR35 reforms in line with previous expectations.
Matt Fryer, group compliance director at Brookson Legal, commented:
“Businesses would be foolish to halt their preparations now and a contractor workforce audit is still incredibly valuable.
The latest announcements from Labour and the Conservatives only add to the uncertainty for contractors and businesses, many of whom have already invested considerably in preparation for April 2020. Clear communication is a priority for those who are likely to be most affected.”
People Management reported that Fryer also explained that he didn’t think the policy would be abandoned due to the fact that it is predicted that it would generate an additional tax revenue of £1.3 billion.
The Liberal Democrats and the Scottish National Party explicitly referred to a reassessment of the new rules in their manifestos. Whilst both Labour and the Conservatives remained silent on the issue in their manifestos, they have both since confirmed that they will conduct a review of the rules should they be elected later this month.
The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
Page 475 of 629
Made with FlippingBook - Online magazine maker