Government postpones the IR35 reform until April 2021 due to the coronavirus crisis

Stephen Barclay MP, Chief Secretary to the Treasury, announced yesterday that the government will postpone the off-payroll reforms due to be implemented on 6th April 2020. In reaction to this announcement, Claire Brook, Employment Law Partner at Aaron & Partners, said: 

“Yesterday the Government announced that it would be delaying the planned IR35 reform due to the current coronavirus crisis, with the legislation now due to be reintroduced in April 2021.

“This now means that medium and larger companies are no longer going to have to bear this additional burden in what is such an extreme climate for the business community. 

“Although this will come as welcome news to a huge number of employers, agencies and contractors there will also be many who believe this announcement has come far too late. Many businesses have already implemented their IR35 strategy and a significant number of contractors have already had contracts terminated. 

“Following the announcement, many have called for the scheme to be scrapped altogether, however the government has made it clear that this is a deferral, not a cancellation, that has been implemented to support businesses and individuals through what is a challenging time. 

“We have never seen a time where so many employment law changes have come into place so quickly, and we are seeing new developments each day.  It’s been positive to see that during this time employers continue to seek solutions that will provide the best outcomes for their employees and businesses working together to support the community.  It is important to reiterate that given the pace of legal change it is vital that businesses seek professional advice at this time to keep up to date.”