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COVID-19 and IR35: Should your clients relax now the legislation is postponed?

Posted on 5th May 2020 by Paul Mason, Head of Tax Partnerships at Markel

Legal expenses insurance is ideal for ir35 tax investigations

Steve Barclay, the Chief Secretary to the Treasury, announced that due to the effects of Covid-19 (Coronavirus), the changes to off-payroll working (IR35) in the private sector would be delayed by 12 months.

Many businesses will be heaving a great sigh of relief at the news – one less thing to worry about in the short term, right?

However, the Government has made it very clear the changes are coming in April 2021. So, whilst it might be tempting to put everything on hold for 12 months, we do suggest that people don’t wait until the first quarter of next year to return to the issue.

For those of you who were already dealing with the new legislation, this preparation will not be in vain as you will need to do this come next year.
However this does mean that for the next 12 months, the decision and potential IR35 liability in the private sector, remains solely with the Personal Service Company (PSC).  As it is only the PSC who can make that decision, it is only the PSC who is liable.

We are, of course, on hand to help contractors operating through their PSCs with contract reviews, and can offer insurance cover for concerned contractors who want to ensure they are protected.

We will continue to provide guidance and support to all our clients; however, for now at least, private sector end-clients can concentrate on dealing with their contracting and supply chain issues, and pick up IR35 again later in year once everything is back to normal!

Markel’s COVID-19 Hub contains a range of information and resources to best support our clients during this difficult time.

Author: Paul Mason, Head of Tax Partnerships at Markel

Email: paul.mason@markel.com

Original article here: https://www.markeltax.co.uk/industry-news/covid-19-and-ir35-should-your-clients-relax-now-th

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