With private sector IR35 reform looming, we asked a leading IR35 advisory firm what practical steps professional contractors can take now to prepare in advance for the changes.

A confirmation of arrangements letter from your client can be used to back-up your IR35 position with HMRC should it be challenged, as it confirms how you perform your contract duties in reality.

The Intermediaries Legislation (aka IR35) was first mentioned in a 1999 Inland Revenue press release. Here we look at the key events which have taken place over the past 20 years, and the status of IR35 in 2020.

To ensure that any contracts you undertake are not caught by IR35, you need to be able to demonstrate that you are not a disguised employee, but truly working in the manner of a small business owner. In other words, can you show that you are ‘in business on your own account’?

If you work on an ‘inside IR35’ contract post-April 2021, then your fee-payer (agency or client) will be responsible for deducting taxes from your contract income, but exactly how is this income taxed before your limited company receives funds?

The Off-Payroll private sector rollout has been deferred by a year, until April 2021. Steve Barclay MP made the announcement in the House of Commons tonight.

With changes to HMRC’s off-payroll tax rules coming into force in less than a month, many businesses are still struggling to understand their exposure to the new legislation.

The Government has published the results of its post-election IR35 review. As expected, nothing of any substance has been announced, although HMRC has promised to take a ‘soft’ approach to compliance during the tax year following the April 2020 off-payroll private sector changes.

With the private sector off-payroll changes set to go ahead in April 2020, some ‘outside IR35’ contractors may be forced to work ‘inside IR35’ if their clients are reluctant to take on the potential risks of making incorrect employment status decisions – at least for the time being.