IR35 tax reforms deferred until 2021

By Charlie Catton

​UK government puts IR35 tax reforms on hold for a year in wake of coronavirus crisis

News broke on Tuesday 17 March 2020 that in response to the coronavirus pandemic, IR35 tax reforms for private sector workers will be delayed for a year.

The decision was announced by the government as part of a rescue package for the UK economy.

There’s every indication that this is a delay rather than a cancellation of the reforms to the off-payroll working rules that were due to come into effect on 6 April 2020.

The suspension is in direct response to the spread of COVID-19 and is designed to help businesses and individuals. Chief Secretary to the Treasury Steve Barclay has, however, confirmed that the reforms will still go ahead as planned the following year. Speaking in Parliament, he said:

“This is a deferral, not a cancellation, and the government remains committed to reintroducing this policy.”

So, what does this mean for Sanctuary Personnel’s contractors?

If you are a contractor working in the public sector, where the IR35 tax reforms were introduced in 2017, IR35 will continue to be applicable. For private sector contractors though, IR35 off-payroll will not be a consideration until at least April 2021.

If you have any questions about what this means for you as a contractor, please contact your consultant.