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Do You Know How The New Off-Payroll Rules Will Work?

Contractors working in the private sector may want to make sure that they’re as familiar as they can with the new off-payroll rules that are set to come in next year, so they can properly prepare for the changes when they happen.

From April, responsibility will shift for determining whether a work-related engagement falls within the rules from the worker’s personal service company to the business that needs said worker’s goods or services. If the rules do apply, then the agency or engager of the work will be responsible for applying the right tax and National Insurance contributions.

But the Association of Taxation Technicians (ATT) has now issued a call for the changes to be clarified further, with concerns raised about the lack of detail in the draft legislation bill, which was published in July.

For example, insufficient detail has been provided regarding when an engager would be liable for unpaid tax and National Insurance because someone else in the labour supply chain hasn’t met their obligations under the new rules.

Co-chair of the ATT’s technical steering group Michael Steed said: “Uncertainty in how the off-payroll rules will operate in practice is making it difficult for businesses to make adequate preparations. We encourage HMRC to release more information and detailed guidance as soon as possible.

“These changes come in from next April which means that businesses now have only about six months to get ready – and this at a time when many may also be preparing for or responding to the implications of Brexit.”

Businesses can find further information relating to the off-payroll working rules (also known as IR35) on the official government website.

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Published On: October 23, 2019

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