IR35: Soft approach ends as HMRC toughens stance on non-compliant employers

18 May 2022

HM Revenue and Customs’ (HMRC) temporary moratorium on collecting penalties for IR35 mistakes has ended and many large businesses have reported receiving HMRC queries regarding their application of IR35 rules. 

As of April 2021, large, medium sized or voluntary organisations are responsible for determining their contractors’ employment status. It is important that the hiring process and the process for determining employment status or deciding whether to outsource are correct and clearly documented. Organisations should ensure that off-payroll workers are indicated as such in their payroll software, and if this information has been omitted in any pay runs, revised submissions should be sent for these periods.

IR35 legislation is complex and it is important that it is understood and applied correctly to avoid penalties. The CIPP provide a training course entitled ‘Off-payroll working (IR35) and other employment status considerations’. The course only takes half a day but goes into a lot of details surrounding employer responsibilities. 

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