Private Sector IR35 compliance checks have started
Back in February 2021 Chancellor Rishi Sunak stated that IR35 enforcement for the latest round of the off payroll rules would not be ‘heavy handed’. Yet today, The Institute of Chartered Accountants in England and Wales (ICAEW) are reporting Private Sector off payroll (IR35) checks have started. Focusing primarily on those businesses operating in the oil & gas and banking & finance sectors.
In letters sent to these companies, HMRC requests to find out more about how these businesses engage their workers and how they apply the Off Payroll Working rules. The letters do go on to say that businesses can work with HMRC to improve their processes in line with the rules. But also points out that there may be liabilities for unpaid taxes and even penalties for those not applying the rules correctly.
IR35 Shield CEO Dave Chaplin commented: “This is earlier than I thought checks might start happening, but this is a good thing, as problems can be caught earlier and those doing the right thing can get peace of mind.”
Public Sector organisations have been subject to the IR35 rules since April 2017. Over the past few months there have been public sector settlements including £87.9m for the Department for Work and Pensions, £33.5m for the Home Office and £12.5m for the HM Courts & Tribunal Service.
If you are still unsure about your obligations under the private sector off payroll rules check through our IR35 resources and get in touch if you need any advice or assistance.