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Off-payroll working reforms from April 2020 – HMRC publishes new and updated guidance

Off-payroll working reforms from April 2020 – HMRC

HMRC has published new and updated guidance to support implementation of the reformed off-payroll working rules from April 2020.

Colin Ben-Nathan


KPMG in the UK


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HMRC’s guidance follows the publication over the summer of draft legislation and supporting documentation by the UK government. 

It sets out how businesses should account for tax and NIC on those engagements that fall within the scope of the rules, as well as how the reforms will affect large and medium-sized companies in the private and third sectors.

The new and updated guidance

The links to the new and updates guidance are below:

New guidance

Understanding off-payroll working (IR35)

Private sector off-payroll working for clients

April 2020 changes to off-payroll working for clients

Off-payroll working for agencies

April 2020 changes to off-payroll working for intermediaries

Fee-payer responsibilities under the off-payroll working rules

Updated guidance

Prepare for changes to the off-payroll working rules (IR35)

Public sector off-payroll working for clients

Private sector off-payroll working for intermediaries

Public sector off-payroll working for intermediaries

How to calculate the deemed employment payment

Whilst HMRC guidance on the new rules is to be welcomed, it is fair to say that more detailed guidance is still needed and we hope this will be available at the earliest opportunity to give businesses time to comply.

Alongside this guidance, we understand that HMRC is continuing to work on enhancements to the Check Employment Status for Tax (‘CEST’) tool and have committed to release an updated version ahead of April 2020. However, we think it is important the updated version is released as soon as possible as many businesses will be aiming to complete the bulk of their assessments by the end of Q4 this year.

What should organisations do now?

HMRC has begun to contact businesses affected by the upcoming changes with a view to arranging meetings to discuss what steps they are taking or plan to take, ahead of April 2020.

With this in mind, organisations should work to identify workers affected by the new rules and assess the impact on their contingent labour arrangements, including the implications for current arrangements with contractors and agencies.

Once current workers have been identified, robust processes will need to be introduced to determine their status under IR35 and manage information flows in the labour supply chain.

As part of its communication campaign HMRC is holding a webinar on Friday 20 September to provide stakeholders with an update to the off-payroll working rules. You can register for the webinar here.

How can KPMG help?

KPMG has developed a suite of technology tools to support clients in complying with the new rules, including:

  • A tool to identify which of an organisation’s suppliers may comprise Personal Service Companies, including verification with data held at Companies House;
  • An employment status determination tool tailored to addressing the role profiles that exist in the organisation; and
  • A workflow tool so that the assessment process moves dynamically from determination, to review, to the issue of Status Determination Statements with a ‘state of play’ dashboard available for accredited users. The system also captures and stores relevant information for reference in case of a dispute or presentation to HMRC in the event of an enquiry, for example.

Should you wish to discuss the new HMRC guidance or explore how KPMG can help you prepare for the April 2020 changes, please get in touch with your KPMG contact.

Further insights on off-payroll working

Off-payroll working from April 2020 – getting ready for the new regime

The government has published its final proposals for reforming the off-payroll working rules. What should you do now?

Off-payroll working from April 2020: what happens next?

HMRC’s consultation on off-payroll working closed on 28 May – read our insights on what organisations should be doing now.

Off-payroll working – consultation on the new regime

The Government’s consultation on off-payroll working runs until 28 May 2019 – what does the proposed new regime look like?

Off-payroll working in the private sector: KPMG’s consultation response

KPMG has submitted its views on HMRC’s consultation on off-payroll working in the private sector.

Consultation on off-payroll working in the private sector launched

The Government’s long awaited consultation on off-payroll working in the private sector was launched on 18 May.

IR35 in the public sector

HMRC has now started to review compliance with the new IR35 rules.

Autumn Budget 2017: Off-payroll workers in the private sector

The Government has announced its intention to consult on the extension to the private sector of the IR35 reforms, introduced in the public sector earlier this year.

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