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IR35 reforms delayed for one year due to coronavirus

IR35 reforms delayed

Chief Treasury Secretary Steve Barclay has announced that the IR35 legislation is to be pushed back by one year to help businesses and individuals.

Delayed to 6 April 2021

The changes to the IR35 working rules have been delayed by 12 months, with measures now coming into effect on 6 April 2021, due to the business uncertainty surrounding the coronavirus pandemic.

IR35 is designed to close the loophole in the tax system where workers could use the setup of a limited company structure in order to pay less tax.

The IR35 legislation due to be introduced next month would have made organisations responsible for determining whether a contractor working for them should be treated as an employee for tax purposes.

Deferral to help businesses

Confirming the decision was “a deferral, not a cancellation”, Steve Barclay said that the move is part of a broad package of measures the Treasury has announced to protect the economy and that the government remains committed to reintroducing this policy next year.

Read the article in City AM

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