Since the latter half of last year, the upcoming IR35 changes were published everywhere. Even if it didn’t apply to you, you would have seen or read at least a handful of articles of these new rules for contractors and their rights. And now, as we attempt to cope in a coronavirus world, contractors are celebrating, albeit in the comfort of their homes.
Steve Barclay, the chief secretary to the Treasury said: “I can also announce this evening, madam deputy speaker, that the government is postponing the reforms to the off-payroll working rules, IR35, from April 2020 to the 6th April 2021. Contractoruk.com
With the heavy weight of a global pandemic already crushing contractors, as many are forced not to work or to take unpaid leave with dramatic effects to their income, it really does bring everyone in the contracting industry a huge sigh of relief.
The ministers are adamant that this is a deferral of the legal bill rather than a cancellation – something which the contracting world will no doubt, but leap with joy at the extra time they’ve given to prepare for a demanding change. It’s sort of like a free kick being given at the last second.
This could not have come at a better time. When contractors were majorly at a loss, especially as IR35 meant that they would lose their right to set their own status, the postponing of the new tax rule has given them back some power. It did not go unnoticed that many disagreed or found that the bill had many grey areas as contractors feared to be mistreated or misdefined by their employers.
On the other side of the fence, both employers and recruiters also welcome the delay. Without a doubt, uncertainty meant that employers were put under pressure to categorise their contractors, many having to lose or put their valuable, outsourced talent at risk.
By postponing IR35, there really is one less thing for contractors, and those who hire them, to worry about for now. In the meantime, you’ll want to recap what IR35 changes will mean and more:
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