Government in shock delay to private sector IR35 reform from April 2020 to the 6th April 2021

Government in shock delay to private sector IR35 reform, thanks to peers and covid-19

The government has sensationally delayed private sector IR35 reform by a life-changing 12 months, after pressure by peers – and the coronavirus – made not deferring the off-payroll rules unjustifiable.

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.

“Government will therefore not move the original resolution tonight, but will shortly table an additional resolution confirming that we will reintroduce the off-payroll working rule provisions by amending the bill, with a commencement date of 6th April 2021.”

“This is a deferral in response to the ongoing spread of COVID-19 to help businesses and individuals.

“This is a deferral, 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 tax as those employed directly.”

'Off-roll' rules delayed

Despite the minister fluffing his words – he twice called IR35 the “off-roll” working rules, advisers to contractors are ecstatic.

“Although the wider backdrop of COVID-19 is concerning, this is great news,” says James Poyser, chief executive of inniAccounts.

“The Lords made it pretty clear in their committee hearing that the Treasury's IR35 position was increasingly untenable, with the rising backdrop of Coronavirus. I do welcome this pause”.

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