The acting leader of the Liberal Democrats, Ed Davey, has called on the government to scrap the Off Payroll Working Rules, due to come into force on 6 April 2021.
The rules would require end-user clients engaging contractors via personal service companies to undertake a determination of the contractor's employment status for tax purposes and to operate payroll and deduct taxes on fees to contractors who are deemed to be employees of the end use client for tax purposes.
The implementation of the rules has already been delayed by a year because of the impact of Covid-19.
Davey is now calling on the government to scrap the rules entirely and has tabled an amendment to the legislation implementing the rules. The draft legislation is currently at its final debate stage in the House of Commons before being approved. The amendment is due to be debated this afternoon with the legislation likely to be passed in the next day or so if the amendment is not successful.
“Delaying the change to next April will do next to nothing to reduce the impact of Covid-19 which will be felt for months – if not years – to come. This is not the time to add to the burden of the self-employed.”