COVID-19 Coronavirus Business Impact: IR35 Reforms Postponed

Reforms to the off-payroll working rules (known as IR35) have been postponed until 6 April 2021 in order to reduce pressure on private sector organisations after the COVID-19 outbreak.

As explained in our previous OnPoint, the government had intended that medium and large organisations in the private sector would become responsible for determining the employment status of individuals, who provide their services to the organisation through intermediaries, from 6 April 2020.

However, on 17 March 2020 during the parliamentary debate on the Budget, Steve Barclay, chief secretary to the Treasury, announced that: "the government is postponing the reforms to the off-payroll working rules - IR35 - from April 2020 to 6 April 2021…. This is a deferral in response to the ongoing spread of coronavirus to help businesses and individuals affected.”

The government stressed that this is a deferral and not a cancellation and, as such, these latest developments should not require a reversal of any measures already taken in anticipation of the original 6 April 2020 implementation date.