Limited Company Contractors Update Delayed To April 2021

Written By Jesse Garrett

Dear Limited Company Contractor,

Further to the government’s announcement, Off-Payroll working rules reforms have been delayed by 12 months. The reforms will now come into effect on 6 April 2021 as part of response to COVID-19.

Currently, any agency worker who supplies their services directly to a public sector body via an intermediary (such as a limited company) is subject to, unless certain rules apply, having Tax and National Insurance deducted from any payment due to them.

From April 2020 this legislation was due to change so that services provided directly to the private sector will also be subject to Tax and National Insurance which has now been delayed to April 2021.

See important agency update for limited company contractors

Therefore, moving forward, for shifts worked from the above date, we will continue to pay as normal when you work for our private sector clients however, when you work for a public authority such as the NHS, a prison or a local authority we are required, by law, to make payroll Tax and National Insurance deductions. Naturally these will be fully reported to you by the usual methods such as emailing/posting. We cannot provide you with tax advice – you should take independent advice – but it is our understanding that these changes should not increase your tax liability, rather will affect the timing of the payment thereof.

It is important that you familiarise yourself with the IR35 update and more information on this can be found on the HMRC website.

If you have any questions, please do contact the payroll department.

Sincere regards,

The A24 Group Payroll Department

Jesse Garrett
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