A consultation into off-payroll working in the private sector will be launched in the coming months, confirmed the Chancellor in his written ministerial statement following last week’s Spring Statement.
The consultation will consider how to tackle non-compliance with IR35 and will draw on the experience of the public sector.
Last April, the responsibility for deciding whether IR35 applied in the public sector shifted from the worker to the end engager, to ensure the correct taxes were being paid.
The IR35 rules have been deeply unpopular as they appear to have increased costs for public sector bodies. Findings from the Association of Professional Staffing Companies (APSCo), also revealed that there had been a 70 per cent decrease in the number of contracts available in this market.
The announcement of a consultation to extend IR35 rules into the private sector confirms the fears of industry commentators that engaging contractors is likely to become more expensive.
‘While the written ministerial statement did confirm that a consultation on off-payroll working in the private sector will be launched ‘in the coming months’, there are still no firm timelines attached to this,’ said Samantha Hurley, Director of Operations at APSCo.
‘APSCo maintains that a move to extend recent legislative changes to the private sector at this time is ill-conceived, and we will be sharing this view, and the evidence behind our position, when the opportunity does present itself.’
Last week’s Spring Statement contained few surprises and mostly reiterating policies that had previously been announced. However, the government did state that it would be releasing up to £80 million to support small businesses to employ an apprentice.
