IR35 change put off until 2021

The UK Government is postponing the reforms to the off-payroll working rules IR35 for a year, as part of its business support measures in response to the coronavirus outbreak.

The reforms, which treat certain self employed contractors as employees of their client businesses for tax purposes, were to have been extended to private sector companies from April 2020. This has now been postponed to 6 April 2021.

Announcing the move in the House of Commons, Steve Barclay, Chief Secretary to the Treasury, said it was a deferral in response to the ongoing spread of COVID-19 to help businesses and individuals.

He added: "This is a deferral, not a cancellation, and the Government remain committed to reintroducing this policy to ensure that people who are working like employees, but through their own limited company, pay broadly the same tax as those employed directly."