From April 2021, large and medium firms in the private sector that hire contractors will be responsible for determining their IR35 status rather than the contractors themselves as the Off-Payroll legislation takes effect. Whilst many oil firms will continue to hire contractors off-payroll, we are seeing some taking a risk-averse approach and issuing blanket bans on hiring contractors who work through their own personal service companies, insisting instead that they all go PAYE, either directly or via agency payroll.
Employment experts have warned that hopes of a further IR35 delay are “fanciful”, despite months more of Covid lockdown measures coming.
In the Chancellor’s most recent Autumn Budget the UK government confirmed plans to reform the IR35 tax legislation for the private sector.
In April 2020 the Government’s IR35 payroll reforms will come into effect in the private sector, putting the responsibility firmly on larger employers for PAYE and NICs in respect of contractors engaged via an intermediary.
With the North Sea in the midst of a resurgence, there’s a slight temptation for some in our sector to forget a few of the smaller things that are going on. But the recent UK budget saw a call-to-action for the oil industry.