Government publishes February 2019 IR35 Forum Minutes

10 May 2019

  • Government confirm that following the 12 week consultation on the IR35 April 2020 reforms into the private sector, legislation would be published in the summer and included in the Finance Bill 2019/20
  • HMRC advises that they are continuing to work with stakeholders to enhance the ‘Check Employment Status for Tax’ (“CEST”) tool
  • HMRC invited Forum members to comment on the Mutuality of Obligation (“MOO”) paper by 7 June 2019 in order for HMRC to prepare a revised version ahead of the next quarterly meeting
  • HMRC restated that, for tax purposes in respect of umbrella contracts, where there are gaps between a series of individual contracts, each contract needs to be considered
  • Forum members should consider the issues raised by short term contracts and referred to the differences in interpretation between Tax Tribunals and Employment Tribunals
  • HMRC confirm that they will work with stakeholders to consider whether MOO can be included in CEST

Aspire Comment

Government’s process of publishing Forum notes considerably after the meeting date means that the majority of the information contained within the minutes is no longer ‘news’. However, the minutes do provide us with confirmation that HMRC will be reviewing its policy paper on MOO and is working to include questions relevant to MOO in the CEST tool.

The minutes also state that Forum members believe HMRC’s Spotlight 45 is excellent and encouraged that they use it to further publicise non-compliance. We had to re-read Spotlight 45 to make sure we hadn’t missed HMRC’s apparent success…

The Spotlight still contains a worrying misconception of umbrella companies, agencies and the intermediary sector as a whole. It is evident that HMRC’s understanding of how the sector works is misconceived and simply inaccurate but, encouraged by the Forum members, it appears that HMRC will continue to tarnish the industry as a whole as opposed to identifying specific perpetrators of the avoidance schemes detailed in their Spotlight.