Payescape: Get ready for off-payroll rules

The off-payroll rules (IR35) that were set to be implemented in April 2020 were delayed until 6 April 2021. The new regulations will affect contract and self-employed workers in medium and large private sector companies. The changes were enacted years ago in the public sector to ensure employees working on-payroll and workers being paid “off-payroll” as contractors were all paying similar tax and national insurance payments.

The delay for private sector employees due to COVID was put in place to protect the self-employed sector during the pandemic, but there will not be another delay in the implementation this year. Employers who hire contractors and self-employed workers must ensure accurate reporting of employment status for those who are considered “off-payroll”.

If you have contractors and self-employed staff working in your business, you must be prepared for the changes to take effect 6 April as the government has not made any indication there will be another delay to the rules. Ensure your reporting for off-payroll workers is accurate, and the appropriate withholding for tax and national insurance contributions is identified.

Payroll teams need to be prepared for the changes to ensure compliance with the new regulations. If your team needs help navigating the new IR35 rules, our CIPP-certified team can help with compliance-related questions. Our cloud-based payroll with customized reporting and direct filing with HMRC helps your team stay ahead of payroll changes and deadlines. Talk to us today about simplifying your payroll process.