A leading tax expert has welcomed the decision to delay complicated tax changes that will affect thousands of contractors in the private sector.
The changes to payroll working rules, known as IR35, were due to be introduced in April this year in a bid to prevent working practices that Her Majesty’s Revenue and Customs regarded as “disguised employment” and would have affected many companies in the private sector.
But because of the coronavirus outbreak Chief Treasury Secretary Steve Barclay announced that the changes would be put back until 6 April 2021.
Jonathan Walton, managing director of Whitley Stimpson, one of the largest independent accountancy practices in the area with offices in Banbury, Bicester, High Wycombe and Witney, welcomed the delay.
He said: “This is good news. The tax has been delayed as part of the package aimed at helping business through the virus crisis. It affects many businesses and people in the private sector and it is quite complex.
“The delay will give everyone the chance to prepare properly for the changes which can only be a good thing.”
Earlier this year Jonathan warned that the IR35 reforms will affect all private sector firms engaging temporary resources and would create significant administrative challenges for many businesses.
He said: “It is important that businesses understand the legislation and how the rules will apply to them, their contractors and any agencies with whom they work. Those companies who start their planning processes early will have an edge.”