On 18 May 2018, HM Treasury published a consultation document exploring proposals to increase ‘IR35’ compliance in the private sector.

The ‘IR35’ rules, introduced in 2000, are concerned with so-called ‘off-payroll’ working. The aim of the rules is to ensure that workers providing services through personal service companies (PSCs) pay the same amount of tax and national insurance contributions (NICs) as employees if (had they been engaged directly ie not via a PSC) they would also have been regarded as employees of the services-recipient.

One of the consultation’s proposals is to extend to the private sector the changes introduced in 2017 (applicable to the public sector). These changes, broadly, made the public authority or agency (ie the services-recipient) responsible for determining the IR35 employment status of the worker, as well as being responsible for accounting for and paying tax and NICs to HMRC under PAYE.

The consultation ended on 10 August 2018.

The consultation document can be viewed here.