Off payroll legislation

In the chancellor’s recent budget statement reference was made to the potential of bringing the off-payroll reforms across into the private sector. Such an event would inevitably cause unrest amongst those contractors engaging via a Personal Service Company (PSC) as under off-payroll rules such companies would be required to have standard income tax deductions made at point of payment.

Whilst the chancellor didn’t immediately implement off-payroll in last week’s budget, he did strongly imply that this was the direction likely to be taken, quoted as saying “a possible next step would be to extend the recent public-sector reforms to the private sector”. Supporting this will also be a formal consultation into how non-compliance in the private sector can be tackled effectively which in our experience usually results in new legislation coming in to force shortly after.

Having lived through the off-payroll reforms in the public sector due to our extensive work in the medical sector within the NHS, we are fully aware of the types of conversations that are likely to be had with affected contractors and, most importantly, we have experience in explaining what these changes mean in real terms.

One of the main contributors to the anguish and frustration felt be the affected contractors was the seemingly ‘last minute’ nature of how changes were implemented by many agencies. Our experience from this year’s public reform clearly showed us that those agencies who were proactive in their approach in preparation for these changes experienced significantly less disruption amongst their candidates and came out of the process in a much stronger position than many of their competition.

Ahead of any such changes we are therefore now speaking to each of our valuable agencies who could find themselves dealing with the off-payroll legislation in the not too distant future to discuss a ‘plan of action’ as and when needed. Different industry sectors will have different options available to them therefore it is important to weigh up everything and this is something we can certainly help with.

We will be in touch over the next few weeks to arrange to sit and discuss this in more detail. In the meantime, if you have any questions, as ever please do not hesitate to contact me.

Yours sincerely,

Alex Grant
Managing Director
Quest Pay Solutions