Off-payroll working rules for clients, workers (contractors) and their intermediaries.
The off-payroll working rules can apply if a worker (sometimes known as a contractor) provides their services through an intermediary.
An intermediary will usually be the worker’s own personal service company, but could also be any of the following:
The rules make sure that workers, who would have been an employee if they were providing their services directly to the client, pay broadly the same tax and National Insurance contributions as employees.
These rules are sometimes known as ‘IR35’.
You may be affected by these rules if you are:
If the rules apply, tax and National Insurance contributions must be deducted from fees and paid to HMRC.
The rules apply if a worker provides their services to a client through an intermediary, but would be classed as an employee if they were contracted directly.
If you’re a worker and your client is in the public sector, it’s their responsibility to decide your employment status. You should be told of their decision.
If you’re a worker and your client is in the private sector, it’s your intermediary’s responsibility to decide your own employment status for each contract. The private sector includes third sector organisations, such as some charities.
From 6 April 2020 the way the rules are applied will change.
All public sector authorities and medium and large-sized private sector clients will be responsible for deciding if the rules apply.
If a worker provides services to a small client in the private sector, the worker’s intermediary will remain responsible for deciding the worker’s employment status and if the rules apply.