Last week, Conservative Chancellor Kwasi Kwarteng announced that the UK government plan to scrap reforms to the IR35 off-payroll working rules.
 
The plans, which won’t come into effect until April 2023, will see the responsibility for deciding employment type return to contractors.
 
News of the repeal, which came as part of the mini-budget, has been widely welcomed and has shocked businesses and contractors alike.
 
Recruitment & Employment Confederation (REC) CEO, Neil Carberry said: “Ditching the botched changes to IR35 – the rules on how temporary contractors are paid - is a huge help. These have been big REC campaigns, and we welcome today’s announcements.”
 
IR35 legislation, which has more than often made working as a contractor difficult, means self-employed workers providing their service through their own companies will again be responsible for paying the appropriate amount of tax and national insurance contributions.
 
Under current regulations, contractors working for a company often have the same taxes deducted from earnings as an employee, even if they do not always have the same employment rights, such as sick leave and holidays.
 
Kwarteng said: “We can [also] simplify the IR35 rules, and we will. In practice, reforms to off-payroll working have added unnecessary complexity and cost for many businesses.”
 
For more information and current IR35 guidance, please visit: https://www.gov.uk/guidance/understanding-off-payroll-working-ir35
 
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