Tom Evennett, EY Head of Private Client, comments:
“Framed as a removal of a burden for businesses from April 2023, today the Chancellor announced the repeal of the IR35 changes from 2017 and 2021. These measures were originally intended to put the onus on businesses that were hiring workers via their own personal service company to conclude as to whether these workers should be considered to be employees (and operate withholding on payments) or consultants. The removal of these changes will put the responsibility of concluding upon their status back to the workers personal service company.
“This will remove some concerns for business on making this determination but could drive a rise in personal service companies being established with the expectation that the measure will cost the Exchequer more than £6bn over the next five years.”