New inquiry launched into off-payroll rules in private sector

The House of Lords Finance Bill Sub-Committee has launched a new inquiry on the implementation of the off-payroll rules in the private sector, and how these rules are working in practice.

The deadline for submissions is 15 November 2021. 

This is a follow-up inquiry to the Sub-Committee’s April 2020 report, ‘Off-payroll working: treating people fairly’, on the UK Government’s proposals for moving responsibility for assessing compliance with its off-payroll working rules (IR35) from contractors to those who engage them. 

The questions being asked by the sub-committee is asking are: 

  1. Has the recent extension of the off-payroll working rules to the private sector made it more difficult for engagers (the business the contractor ultimately works for) to hire people with the right skills and expertise? To what extent has its introduction contributed to job vacancies?
  2. For those engagers (and their advisers) who use the CEST (Check Employment for Tax Status) tool to assess employment status, how effective do you consider it to be? Do you have confidence in its results? If not, what further improvements need to be made to it?
  3. What changes have engagers had to make to apply the off-payroll rules to contractors, in terms of systems, personnel and training? By reference to your own experience, to what extent (if any) do you consider that compliance costs have increased because of the changes?
  4. How well has HMRC supported engagers, contractors, and their advisers with the implementation of the new rules and is any further or different type of assistance needed
  5. To what extent has the introduction of the new rules generated disputes between engagers and contractors concerning the status of contractors vis à vis the rules and how successfully or otherwise have these been resolved?
  6. What behavioural effects have resulted from the introduction of the new rules in the private sector in terms of the arrangements adopted in hiring contractors?
  7. The Government is proposing a new employment body with powers to enforce employment rights, including for those engaged by agencies and umbrella companies. How effective do you think such a body will be in ensuring workers, particularly the lower paid, are treated fairly?
  8. How successful will the draft Finance Bill proposals for earlier publication of information about promoters and avoidance schemes be in protecting individuals from being drawn into such schemes?

“The Sub-Committee is particularly interested to hear from bodies that represent businesses that engage workers to whom the off-payroll working rules might apply,” the sub-committee statement said.

Lord Bridges of Headley, sub-committee chair, said: “Our previous inquiry found the government’s off-payroll working rules to be riddled with problems, unfairnesses and unintended consequences. We called for the wholesale reform of IR35.

“We’re carrying out this follow-up inquiry to find out about the experiences of engagers and contractors to date. We want to hear particularly from representative bodies about the experiences of individual contractors.”

Visit the Parliament Call for Evidence page for information about how to submit evidence.

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