Off-Payroll Working in the Private Sector (Rules known as IR35)

Off-payroll working in the private sector – The government reformed the off-payroll working rules (known as IR35) for engagements in the public sector in April 2017. Early indications are that public sector compliance is increasing as a result, and therefore a possible next step would be to extend the reforms to the private sector, to ensure individuals who effectively work as employees are taxed as employees even if they choose to structure their work
through a company. The government will consult on how to tackle non-compliance in the private sector, drawing on the experience of the public sector reforms, including through external research already commissioned by the government and due to be published in 2018.

The public sector IR35 regulations which were introduced in April 2017 moved responsibility for assessing the IR35 status of each contract to the organisation or body engaging the contractor, which would then be responsible for deducting PAYE and NIC.