Major changes are happening this April as businesses become responsible for deciding the employment status of the contractors they engage through an agency or the contractor’s own limited company, known as a Personal Service Company or PSC.

Businesses will assume PAYE liability on the payments it makes for the contractor’s services – if it decides the contractor is really a ‘disguised employee’ rather than a genuinely independent contractor.  These businesses will be known as the ‘fee-payer’.

These changes – known as the Off-Payroll Working Rules and sometimes called IR35 – will affect all medium to large private sector companies with a UK connection from 6 April 2021. (IR35 has been in force in the public sector 2017). Many businesses have underestimated how much preparation is needed to be ready for these new rules.  

Deborah Scales Employment Solicitor explains how to comply.