Barclays to transfer all contractors to PAYE to avoid IR35 issues
03 October 2019
One of the UK’s largest banks has confirmed that, due to upcoming reforms to off-payroll working rules, they will be employing all contractors on a PAYE basis, commencing early 2020.
Currently, the onus for establishing how a contractor should be taxed falls squarely on the contractor themselves but draft legislation (if enacted) means that this responsibility shifts to the end client / engager. Due to the intricacies surrounding how employee status is determined and the potential financial implications on income tax and National Insurance contributions (NICs) liability, Barclays have taken the decision to pay all future contractors under PAYE to simplify matters.
This also removes the necessity to individually assess each contractor which could be time consuming for a business the size of Barclays.
Computer Weekly reports that Barclays sent an email communication out to all individuals who will be affected, advising of their intentions. Speculation is rife that many contractors will move to provide their services to Barclays’ competitors or even make the decision to work abroad as a direct result of the revelations.
Listen to this 25-minute webcast where Diana Bruce, CIPP Policy & Research, covers the key changes (including the new statutory requirement for a Status Determination Statement) that will be brought in by the draft legislation (when enacted) and looks at the practical application of the new rules for off-payroll working in the public, private and third sectors from April 2020.
Visit My CIPP on our website for other topical webcasts - an easy way to update your team on aspects of payroll legislation.
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