• By ICR Secretariat
  • Posted Tuesday, April 4, 2017

Changes to freelance tax status

https://www.gov.uk/government/publications/off-payroll-working-in-the-public-sector-reform-of-the-intermediaries-legislation-technical-note/off-payroll-working-in-the-public-sector-reform-of-the-intermediaries-legislation-information-for-agents

In the Autumn Statement 2016, the chancellor confirmed that, in the public sector only, IR35 status will be determined by the client, not the contractor.

If a client decides IR35 does apply, the contractor business will be taxed at source, through the Real Time Information (RTI) system, exactly as if it were an employee.

Although contractors impacted by this measure may have to pay tax like an employee, their employment status will not change meaning that they would not have the usual employment rights and benefits such as pension contributions, holiday pay and unfair dismissal rights.

 

This topic will be discussed at the forthcoming Freelancer Forum.