Ahead of the much-anticipated results of their IR35 review, expected mid-February, HMRC have added some clarification around what payments IR35 will apply to.


IR35 in the private sector will apply only to payments made for services provided on or after 6 April 2020.


Unlike the 2017 changes in the public sector, any work carried out before 6th April can be paid at the current rate, even if that payment is made after 6th April. This clarification aims to help medium and large businesses affected by IR35, as they will only need to assess the IR35 status of an assignment if the work is expected to continue into the new tax year.

HMRC seem to recognise the short timeframe businesses are now operating on and by releasing these amendments ahead of the results of their implementation review, hope to alleviate some of this pressure.


In a joint statement released by HMRC and HMT, they explained their decision:

A common issue raised over the course of the review has been businesses’ concerns over what payments the rules apply to and from when. The government has listened and taken action early to give businesses certainty and more time to prepare to ensure the smooth and successful implementation of the reforms that come into force in April.”


Unfortunately, this tweak to the upcoming legislation will make little difference to those contractors who have already left their role or those working for the ever-growing list of companies that simply aren’t engaging PSCs after the April deadline.


IPSE’s Andy Chamberlain, Deputy Director of Policy and External Affairs, commented:

“As we approach the April deadline, HMRC is starting to realise just how difficult these rules will be for businesses to implement. Delaying the start date to when the work is actually performed, rather than paid for, is a sensible move, but it doesn’t address the fatal flaws in the legislation itself”


The true extent of any changes to the proposed implementation of IR35 will become apparent with the results of the review expected in mid-February, however, as this amendment was released before those results, we don’t expect any more drastic changes to be made.


If you have any questions on IR35 and how it will affect you after April 6th, call our IR35 helpline for free, no-obligation advice on 0800 880 7056 or email info@icsuk.com and we’ll be happy to help.