Off-payroll working rules: IR35 checklist for contractors - part 3

摘要

When a senior HMRC officer says that those he trained on IR35 would be competent after three years and understand it after five years, and when judges are split in the recent tribunal decision in Paya Ltd TC07377 [2019], one wonders how many years it might take taxpayers, the private sector and general practitioners to grasp this area of complex tax law. When IR35 changes to off-payroll working for private companies come into force in April 2020, private sector entities will bear the responsibility of assessing the employment status of workers/contractors they engage to work for them, among other requirements. This will inevitably present challenges. So, here are 10 things you need to know, what actions to take and tax implications, potential penalties and risks. HMRC has recently announced that it will only use the information it gathers from the new rules to open an enquiry into earlier years if there is reason to suspect fraud or criminal activity. While this will be welcome news for many contractors who are worried that a change in their status stipulated by their private sector client will lead to costly investigation, it is important to note that the offence of fraud (or cheating the public revenue) is wide ranging indeed and can catch behaviours including withholding PAYEational insurance (NI), and failing to disclose income.