IR35 extension to private sector delayed until 6 April 2021

IR35 extension to private sector delayed until 6 April 2021

Employment analysis: A one-year delay to the extension of the off-payroll IR35 regime to medium or large private sector end clients has been announced in the parliamentary debate on the budget on the evening of 17 March 2020 by the Chief Secretary to the Treasury, Steve Barclay.

Hansard, 6.49pm 17 March 2020, Chief Secretary to the Treasury, Steve Barclay

A one-year delay to the extension of the off-payroll IR35 regime to medium or large private sector end clients has been announced in the parliamentary debate on the budget on the evening of 17 March 2020 by the Chief Secretary to the Treasury, Steve Barclay.

In a statement commencing at 6.49 pm he said:

‘I can also announce that the Government are postponing the reforms to the off-payroll working rules IR35 from April 2020 to 6 April 2021. The Government will therefore not move the original resolution tonight, but will shortly table an additional resolution confirming that we will reintroduce the off-payroll working rules provisions by amending the Bill, with a ​commencement date of the 6 April 2021. This is a deferral in response to the ongoing spread of covid-19 to help businesses and individuals. 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.’

Prior to this announcement, it had been intended that the off-payroll IR35 regime would apply to a private sector end client that is either a medium or large entity from 6 April 2020. For further information, see Practice Note: IR35—off-payroll workers.

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