April 18, 2021

Volume XI, Number 108

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April 16, 2021

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Off Payroll Working - New HMRC Guidance for April 2021

The Government has confirmed that, from 6 April 2021, the scope of the Off-Payroll Working Rules (IR35) will be expanded to cover medium and large private sector organisations, employment agencies and third parties within the labour supply chain.

Last week, HMRC published a fresh policy paper. HMRC makes clear the active position it will be taking in supporting organisations in:

  • complying with their obligations under IR35;

  • monitoring compliance; and

  • taking action against organisations that have willfully failed to discharge their obligations under the new rules.

HMRC understands that mistakes will be made when undertaking these processes for the first time and will provide support to help organisations to identify and correct them. However, organisations must make meaningful good-faith efforts to discharge these obligations, as HMRC will not be as supportive or forgiving of those that have deliberately failed to comply with the rules (whether through action or inaction). As such, if they have not done so already, all relevant organisations should be taking positive steps towards IR35 compliance as early as possible. These steps include the following:

  • Auditing contingent workforce and reviewing labour supply chains. Who are your contractors and how are they engaged (e.g., directly, through personal service company or umbrella)?

  • Assessing the impact of the new regime, identifying their responsibilities in relation to existing contractor relationships and carrying out employment status determination statements (SDSs) where needed. Do engagements need terminating, or renegotiating? Do working practices and arrangements need to change?

  • Implementing compliance processes going forward.

 

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© 2021 Vedder PriceNational Law Review, Volume XI, Number 54
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About this Author

Jonathan Maude Labor and Employment Law Attorney Vedder Price Law Firm
Partner

Jonathan Maude is a Partner at Vedder Price and a member of the Labor and Employment group in the firm’s London office.

Mr. Maude is an experienced and well-respected practitioner working in labor and employment law. He regularly advises across the full spectrum of employment law-related issues in the contentious and noncontentious spheres with a particular emphasis on advising corporate clients on complex strategic human resource-related matters.

Jonathan Maude's practice can be broadly broken down into the two areas...

+44 (0)20 3667 2860
Esther Langdon, Employment, LItigation, Attorney, Vedder Price Law FIrm
Solicitor

Esther Langdon is an Associate in the Labor and Employment group in the firm's London office.

Ms. Langdon advises clients on all aspects of employment law, with a particular emphasis on contentious matters before the Employment Tribunal and the High Court. She also advises on the full range of personnel matters, including day-to-day human resources support, disciplinary and grievance issues, reorganizations, restructuring and redundancies.

+44 (0)20 3667 2863
Daniel Stander Labor & Employment Attorney Vedder Price London, UK
Associate

Daniel Stander is an Associate at Vedder Price and a member of the firm’s Labor and Employment group in the London office.

Mr. Stander has experience in dealing with non-contentious and contentious matters for both employers and senior executives. In particular, he has experience in the following areas: day to day UK and international employment and multi-jurisdictional HR issues including unfair dismissal, discrimination and whistleblowing claims, and advising on, preparing and negotiating settlement agreements. Mr. Stander has a particular interest in mental health issues and...

44 (0)20-3667-2861
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