IR35—off-payroll workers
Produced in partnership with David Smith of DLA Piper
IR35—off-payroll workers

The following Tax guidance note Produced in partnership with David Smith of DLA Piper provides comprehensive and up to date legal information covering:

  • IR35—off-payroll workers
  • Engagements to which the off-payroll IR35 regime applies
  • Application to public authority end clients
  • Application to private sector end clients
  • Conditions where the intermediary is a company
  • Employment status of worker—the notional contract
  • Before April 2021—information to be provided by public authority end clients
  • Status determination statement
  • Information to be provided by the worker and consequences of failure and/or the provision of fraudulent documentation
  • Effect of the off-payroll IR35 regime applying
  • more

Coronavirus (COVID-19): in light of the coronavirus crisis, the government announced temporary measures to support the employed. For more detail on this support for the employed, see Practice Note: Coronavirus Job Retention Scheme (CJRS). The CJRS is available if a public sector organisation wishes to furlough a contractor who, under the off-payroll IR35 rules, is a deemed employee. For more detail, see News Analysis: HMRC publishes second update to employer and employee guidance on Coronavirus (COVID-19) Job Retention Scheme.

This Practice Note explains the IR35 regime which applies where:

  1. from 6 April 2017, a public authority, and

  2. from 6 April 2021, a private sector entity (other than one that is ‘small’ or does not have a ‘UK connection’)

engages a worker via an intermediary such as a personal service company (PSC). This regime is referred to as the ‘off-payroll IR35 regime’ throughout this Practice Note.

Broadly, the effect of the off-payroll IR35 regime is, in relevant situations, to shift the responsibility for assessing whether IR35 applies from the PSC to the end client and, in the event IR35 does apply, to shift the obligation to make deductions in respect of income tax and National Insurance contributions (NICs) onto the party that is closest in the relevant contractual chain to the PSC (whether that party is the end client which contracts directly with