IR35 changes move through House of Commons

No changes are expected to the proposals for the new IR35 rules in the private sector, as it continues its passage through the House of Commons.

The implementation was delayed by 12 months due to the Covid pandemic and there had been distant hopes that this might lead to a change of heart. Although there are likely to be challenges to the controversial proposals to roll-out the plans, the Report Stage of the Finance Bill is likely to complete its Commons passage this week without any significant change.

The new rules will give medium and large companies extra responsibilities for determining the tax status of their contractors - in line with provisions introduced into the public sector a few years ago.

Matt Fryer from Brookson Legal said: "We expect to see further spirited challenges to the details of the off-payroll working rules this week, but we would be very surprised if there are any significant changes made to the legislation at this stage. The date is now confirmed for April 6, 2021, so contractors, recruiters and hiring businesses in the private sector should continue their preparations for the IR35 changes next year.

"Many organisations and individuals were not prepared for the original deadline this April, but they now have a second chance to get this right. Jesse Norman MP has been clear during these discussions that blanket assessments will not be sufficient. We are recommending that contractors and their hirers open contractual discussions now in order to iron out any problems in good time. Hopefully lessons will also be learned from the forthcoming report into the poorly managed introduction of changes in the public sector in 2017."