The readiness of businesses for 6th April 2020 introduction of the Off-payroll Working rules within the private sector has recently come under scrutiny from accountancy bodies at the House of Lords finance bill subcommittee evidence hearing.
Representatives from the accountancy bodies told the subcommittee that businesses are not ready for the reforms to come into effect in April because the “legislation is not yet ready”, issues were also raised over the uncertainty of the rules.
HMRC have informed the ICAEW that answers to the outstanding 100 plus questions will become apparent when the guidance is released.
The finance bill subcommittee were also informed that small and medium-sized businesses (SME’s) are less ready because unlike large employers that may have in-house tax teams, it was also stated that SME’s are less knowledgeable about tax, never mind something as complicated as the off-payroll reforms have become.
Although it is extremely unlikely that the start date will be put back again, the subcommittee asked that HMRC need to provide employers with some assurances that the enforcement is going to be proportionate because we don’t want to see any draconian methods taken by some HMRC officers.
It was suggested by the subcommittee that these issues could be resolved through a bedding-in period and as such it is too early to properly determine how the off-payroll reforms have affected the public sector, what we do know, is that lots of contractors left the public sector to go to work elsewhere and consequently the public sector have had problems with resourcing and recruiting.
Some reports suggest that 31 out of 32 contractors walked off a job at the Ministry of Defence.
This wasn’t the only time Westminster felt the effect of IR35 last week, 150 freelancers and contractors organised a protest outside parliament to call for a halt to the off-payroll reforms
