Changes to IR35 tax rules from Thursday 6 April

Thursday, 16 March 2017

From Thursday 6 April, the public sector – including universities – will be responsible for ensuring that individuals working through their own limited companies (also known as ‘personal service companies’) pay the correct tax in accordance with IR35 tax rules. 

A working group of HR, Finance and Procurement colleagues is looking at changes required to ensure the University’s compliance with the legislation. 

HMRC will release a digital tool for public sector bodies to help assess the status of personal service companies. We will use the tool to assess each contractor on a case-by-case basis. 

It is possible that assessments will determine some personal service companies working for the University to be ‘inside’ IR35 tax rules, meaning they must be paid via payroll in order to deduct Income Tax and N.I. 

Failure to comply with the legislation could result in a fine for the University. Further details will be shared with staff and personal service company contractors currently working for the University in the coming weeks.

Please contact Mark Stephenson for further information.