Budget 2017 Summary


In respect of the anticipated roll out of the IR35 reform introduced for the public sector earlier this year the budget states as follows;

Off-payroll working in the private sector – The government reformed the off-payroll working rules (known as IR35) for engagements in the public sector in April 2017. Early indications are that public sector compliance is increasing as a result, and therefore a possible next step would be to extend the reforms to the private sector, to ensure individuals who effectively work as employees are taxed as employees even if they choose to structure their work through a company. It is right that the government take account of the needs of businesses and individuals who would implement any change. Therefore the government will carefully consult on how to tackle non-compliance in the private sector, drawing on the experience of the public sector reforms, including through external research already commissioned by the government and due to be published in 2018.

In years gone by there could easily have been a discussion paper, a consultation, even a second consultation and then legislation all before the April of the following year and I don’t think it is unfair to say that often the thoroughness of the legislation was reflective.

However the above wording coupled with the very welcome statement in the paragraph immediately preceding it makes a more considered longer term approach much more likely;

This is the first Budget in the new annual tax policymaking cycle. The government’s aim is to provide greater tax certainty for households and businesses by consulting with taxpayers further in advance of changes and changing taxes less frequently. Further details on this new process will be set out later this year.

There is no doubt that as a general point the sentiment expressed in this statement is very welcome.

In respect of the remainder of the points of interest mentioned in our introduction, including the April increases to the National Living Wage and the National Minimum Wage rates and any other potentially relevant issues, please see below the initial appraisal of our advisors Chartergate Legal Services;

 

For most, there will be a sigh of relief and some time to prepare for IR35 changes.  As stated, we will provide you with updates when more detail is available and of course be at the vanguard of advising our clients on how to remain compliant and commercial.