Private Sector IR35 Finance Bill measures progress through the Commons
By Justine Riccomini, Head of Taxation (Scottish Taxes, Employment and ICAS Tax Community)
16 July 2020
Justine Riccomini explains what is happening with the IR35 provisions in the Finance Bill as it passes through the Commons.
Time and Tide
A delay to the amended legislation relating to off-payroll working in the private sector (IR35) which was due to be implemented in April 2020 has been pushed back to an April 2021 start date due to COVID-19. This hasn’t deterred the UK Government from continuing to push the provisions through the Commons under the banner of the Finance Bill 2020.
The Financial Secretary to the Treasury, Jesse Norman, tabled the amendments on 27 April – the same day that the House of Lords published its report calling for a re-think on IR35 - and despite some minor attempts at resistance by some MPs, the provisions have thus far been passed at Report Stage in the Commons after passing through Committee Stage without amendment on 18 June 2020.
An amendment which called for a two-year delay to 2023 to implement the private sector changes brought by a cross-party group of MPs headed by Conservative MP David Davis, was defeated by 317 votes to 254 during Committee stage.
Further stages
After the Report Stage, the third reading is usually considered to be a formality before the Bill passes through to the House of Lords – usually thought of as a further formality. However, the smooth progress thus far through the Commons does not mean that the provisions will not reach a stage when they might be amended before the Bill is passed into law.
Dissent?
In April, the House of Lords Economic Affairs Finance Bill Sub-Committee issued its report - the contribution made by ICAS to both the written and oral evidence was mentioned several times. The report described ‘inherent flaws and unfairnesses’ in the whole IR35 regime and the report called for a wider review focus to be taken on the whole subject area of employment status, fair work and working arrangements.
Bearing in mind the content and tone of the House of Lords Report, it will be interesting to see how the Bill fares in terms of the IR35 provisions.
If you wish to contribute to the debate on IR35
If you want to contribute to this matter please contact us on tax@icas.com or start a discussion thread on CA Connect.