As part of the response by the government to support businesses and individuals during the coronavirus (Covid-19) pandemic, the Chief Secretary to the Treasury has announced that the reforms to the off pay-roll working rule (IR35) will now come into force on 6 April 2021. The reforms were originally due to apply from 6 April 2020 and the postponement is being considered as a deferral rather than a cancellation. The new introduction date will be legislated in the upcoming Finance Bill.
The government continues to believe that the reforms are essential to ensure that people working like employees, but through their own personal service company, pay broadly the same tax as individuals who are employed directly. However, the government recognises that the reforms, which have previously been implemented in the public sector, would be a significant change for both businesses and contractors and this delay will allow a further year for business to plan for the new rules.