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Recrutiment & Employment Confederation



On 17 March 2020 the Government announced that it would delay (but not cancel) the IR35 changes in the private sector until April 2021.

The delay is to reflect the challenging economic environment as a result of the Coronavirus and means that the rules which exist in both the public sector and the private sector continue to apply up to and including 5 April 2021.

What does the IR35 delay mean for you?


Download our member guide 


Here are the cruitial points about the IR35 delay: 

  • If your client is a private sector client, it does not have to do anything at the moment.  Up to and including 5 April 2021 the personal service company (PSC) remains responsible for assessing IR35 and for making tax and national insurance deductions accordingly.  Agencies can continue to pay PSCs gross and will not be liable for their failure to comply with the IR35 unless (under existing legislation such as the Criminal Finance Act 2017) it can be shown that they are involved in the facilitation of tax evasion.
  • If your client is a public authority, the rules which took effect in April 2017 remain in place. 
  • Status determination statements (SDS): We spoke with HMRC this morning (18.03.20) and asked them about SDSs which clients have already produced and agencies have acted upon. They advise:  
  1. SDSs which have already been made will have no standing so HMRC will not be interested in them. Contractors working in the private sector remain responsible for managing IR35 until April 2021. HMRC confirmed they will not consider any SDSs made if they open an investigation into a contractor in the meantime.  They will release a statement on this later.
  2. Clients who decided to ban PSCs and require contractors to work via PAYE (whether agency or umbrella) need to decide whether to continue with that ban or to allow PSCs back. That is their decision.


  • Members can continue to use the contracts they currently have with clients and temporary workers/contractors alike.  REC Legal had been working on new contracts to reflect the changes.  We also conducted a fundamental review of our contracts.  We will release the new contracts at some point in the future so that members can manage the transition to those contracts when it suits them.  We will then update contracts in time for the April 2021 changes.
  • HMRC will continue their existing compliance activities. REC has asked HMRC to reiterate in their communications and guidance which schemes they already deem to be non-compliant as a warning not to use these schemes in the coming year.
  • HMRC will use the next year to ensure businesses still preparing for the changes.  They will update their existing guidance to reflect the delay as quickly as possible.

Other materials:

  • REC will update our written materials as quickly as possible to reflect this delay. We are also working on our support package for the 2021 roll out and will update members in due course.  Please keep an eye on this IR35 hub and the IR35 section of the legal guide
  • Meanwhile all the other legal changes resulting from the Government’s Good Work Plan are going ahead.  See the GWP hub for further information on Key Information Documents, Written Statements and the repeal of the Swedish Derogation.

Read HMRC's statement on the IR35 delay.