Last week, HM Treasury published the outcome of its review into the upcoming IR35 reforms. This review does not materially change the previous position - the government continues to believe that it is right to extend the reform of the off-payroll IR35 working rules to large and medium-sized organisations in all sectors from 6 April 2020.

One key takeaway from the review, as indicated by the new Chancellor of the Exchequer last week, is that HMRC will not be ‘heavy handed’ in relation to non-compliance in the first year of the new rules. Businesses will only have to pay penalties for errors in cases of deliberate non-compliance and (unless there is reason to suspect fraud or criminal behaviour) information resulting from the rule changes will not be used to open new investigations into Personal Service Companies for tax years prior to 6 April 2020.

Those who were hoping for a delay to (or cancellation of) the reforms will no doubt be disappointed by the decision to proceed, but the position now appears to be settled and confirms that businesses should be continuing to prepare for the incoming changes. To read more about the upcoming IR35 reforms, and what businesses should be considering in order to prepare, please see our blog post from earlier this month (IR35 – are you ready for the changes to off-payroll working?). To read the review in full, please click here.