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IR35 Tax Changes Postponed By UK Government to Help Contractors and Businesses

18 Mar 2020

Last night it was announced that the UK Government has made the decision to postpone changes to IR35 tax, due to launch this April 6.

The Chief Secretary to the Treasury, Steve Barclay, commented, “The government is postponing the reforms to the off payroll working rules, IR35, from April 2020 to April 6, 2021. This is a deferral in response to the ongoing spread of Covid-19 to help businesses and individuals. This is a deferral and not a cancellation, and the Government remains committed to reintroducing this policy to ensure people working like employees but through their own limited company pay broadly the same amount of tax as those employed directly.”

The Government has made it clear that they intend to implement the new IR35 legislation next year. This welcome delay will provide valuable time for contractors, clients, recruitment agencies and other stakeholders to prepare, following the unprecedented effect of COVID-19 on the worldwide economy.

The Deputy Director, at the Association of Independent Professionals and the Self-Employed (IPSE), Andy Chamberlain said on Twitter: “Very sensible move by government. It would have done serious damage to self-employed businesses in any circumstances, so right that it’s paused for at least a year in this grave and unprecedented situation.”

Dave Chaplin, CEO of ContractorCalculator, said, “With contractors facing the prospect of losing work with no sick pay, it was clearly the right and sensible thing to do.”

At First Recruitment Group, we have been working closely with APSCo, the international trade body for the recruitment sector, as well as working closely with our clients to ensure they are fully prepared for these changes. However, in light of such unusual circumstances around COVID-19, we must all adapt, and continue to do so.

Lewis Trow, Client Development Director, at First Recruitment Group said, “This delay will help many of our contractors and clients through what is set to be a very difficult time for the whole world. We will continue to support both our contractors in whatever way we can through jobs and up to date information. We will also continue to work closely with our clients at this difficult time, to recruit business critical candidates, and to help them prepare for IR35, when the time comes. Our business is agile and flexible and will continue to adapt as Government advice changes to reflect the needs of the country.”

BUSINESSES: If your company needs advice on how to adapt your recruitment process during this difficult time, contact Lewis Trow on lewis.trow@firstrg.com

CANDIDATES: We are also still recruiting for job opportunities with many of our clients, especially those that are business critical. We are working closely with them as they adapt their interviewing processes to protect candidate health. You can read about the most recent interview procedures being implemented as well as video interviewing tips here.

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Bureau Veritas

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Nuvia

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Simon Carves Engineering Ltd

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