The 23 September Fiscal Statement included the unexpected news that the “off-payroll working” (OPW) rules would be scrapped from 6 April 2023.
These rules were introduced for public sector employers from 6 April 2017 and then extended to large and medium-sized private-sector organisations from 6 April 2021.
It has now been announced that the OPW rules will continue to apply. Affected organisations will continue to be required to determine whether or not a worker providing services via their personal service company (PSC) would be classed as an employee if they were working directly for the organisation. If so, then PAYE and NICs need to be deducted from the supplier payments made to the PSC. Employers’ NICs also need to be paid.
Where a PSC supplies services to a small private-sector organization, the ‘IR35’ rules also continue to apply. These effectively require the PSC, rather than the service-acquiring organisation, to ensure compliance.
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