The IR35 reforms to the tax system will still be brought into law by the originally planned date of April 6th next year, despite calls for them to be put on hold due to concerns about the impact they are having on businesses.

The calls fell on deaf ears, as the planned vote in parliament over the amendment to delay them until 2023 was scrapped when it was decided that it could not possibly win majority support. IR35 will render SMEs and bigger firms responsible for working out the employment and tax status of all of the contractors they use, instead of these freelancers having to do this themselves – with the aim being to cut down on disguised employment being used for tax avoidance.

Since HMRC made the announcement of the IR35 changes, a number of firms in the UK have opted to effectively blacklist contractors who operate using personal service companies (PSCs) rather than risk being hit with an unexpected tax burden under the new rules. Others will be speaking to an accountant who deals with tax return services in South Yorkshire, or whatever part of the country they are based in, to see if they could be liable.

The Treasury financial secretary, Jesse Norman MP, stated that the department would not agree to any delay because the reforms were needed to level the playing field between public and private sectors, and because any delays in implementation would be costly and would have to be met by the taxpayers.