Private sector off payroll working rules – draft legislation and guidance
Private sector off payroll working rules – draft legislation and guidance
Wed 12 Feb 2020
In response to the UK review of off-payroll working rules, the Government has announced that the rules will only apply to services undertaken on or after 6 April 2020. This means that payments made on or after that date in respect of services provided before that date are not subject to the new rules.
HMRC has also issued draft guidance on the operation of the off-payroll working rules in its employment income manual. This guidance incorporates the new commencement provision recently announced.
Consultation on draft secondary legislation and technical note
A consultation on draft secondary legislation and a technical note for off payroll working rules has also been issued. The draft regulations concern:
- The draft Income Tax (Pay As You Earn) (Amendment) Regulations 2020 contain detailed provisions allowing for the recovery of PAYE Income Tax liabilities from a third party where a deemed employer (the party treated as making a payment of earnings to the worker’s intermediary) has failed to make PAYE tax deductions from payments made in relation to an off-payroll worker and there is no realistic prospect of recovering the outstanding Income Tax from the deemed employer within a reasonable period. These draft regulations also amend the PAYE regulations to provide for the reporting of an off-payroll worker indicator on PAYE Real Time Information (RTI) returns.
- The draft Social Security Contributions (Intermediaries) (Miscellaneous Amendments) Regulations 2020, make similar provisions to those provided for in the draft primary legislation and in the draft PAYE regulations for NICs purposes.
Comments on the draft regulations are requested by 19 February 2020. For further guidance on dealing with the above for your business and the introduction of off-payroll working in the private sector, please get in touch with the Mazars employment tax team.
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