HMRC issues consultation on IR35/off-payroll reforms to the private sector
HMRC has now issued the long-awaited consultation into off-payroll reforms for the private sector, due to be effective from April 2020. At a glance there are some interesting points being consulted on:
- Feepayer responsibility to rest with the last UK-based entity in the supply chain. This is obviously aiming to close a potential offshore loophole, and should encourage better supply chain compliance.
- Improvements in communicating the IR35 determination, and considers how to ensure it is communicated and shared with the worker. (This does not always happen currently)
- Review of HMRC’s CEST tool with regard to improving it for future; we already have a meeting for FCSA members scheduled with them next month.
- The 5% expenses will be going, in line with the public sector reforms. Whilst no surprise, it is disappointing because now more than ever people will need professional advice and therefore expenses.
- There is a total absence of any sort of appeals process / what to do if incorrectly determined inside IR35. Again not really surprising, but surely there should be a mechanism for redress for people incorrectly determined as being inside IR35.
You can read the full consultation here
The deadline to submit responses to the consultation is Tuesday 28 May 2019.
As ever, we will be seeking input from FCSA members and stakeholders to shape our position on all of the issues, and we will be organising opportunities for views to be shared accordingly.