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IR35 April 2021 Changes Explained

The latest changes to the IR35 seem to have dragged on and on... They were originally meant to take place in April 2020, but like most things over the last year, they got delayed. Are you aware of what the old IR35 rules were like and are you aware of the changes happening in April? Lets take a look...

How It Worked In Years Gone By

In the past it was left up to the personal service company (PSC) to determine their own status on an assignment under IR35 legislation. The HMRC wasn’t all that keen on this way of doing things so they have put an end to it and from April 6th 2021, it’s all change

What Changes Are Coming?

Well, the short answer is the very same changes that were going to take place in April 2020.

But lets break it down again so we're all on the same page:

  • Contractors will no longer determine their own IR35 status, this responsibility now falls on somebody else

  • Who? The end-client is now responsible for determining their contractor’s IR35 status

  • These changes are the same that the public sector implemented back in 2017 and was successfully rolled out

Are There Exceptions?

Yes there are. These new rules apply to ‘medium or large businesses’ in the private sector and all businesses in the public sector. What criteria determines whether you’re a small business then?

  • Annual turnover of no more than £10.2 million

  • Balance sheet total of no more than £5.1 million

  • No more than 50 employees

The other exception to the new rules is if the end-client company has no presence in the UK.

If you need help to determine the IR35 status of yourself or your contractors, get in touch with our team today!


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