Great Britain : private companies tasked with assessing the tax and social status of their service providers

On 11 July, the government published a bill confirming that it plans to extend the IR35 tax legislation to small and large private companies. As of 6 April 2020, the groups concerned will have to indicate whether their service providers will have to pay income tax and social contributions and will be held responsible for any error. The aim of this change – announced during the most recent budget (see article n°10877) – is to discourage illegal recourse to independent workers. In the public sector, this law has been in place since 2017 and has resulted in the classification of many self-employed people as “workers”. Large private companies have expressed their concern, since they have only 9 months to prepare for the IR35 coming into force, which may complicate the work of HR departments at a time when they are fully occupied with Brexit. This change also worries some 170,000 self-employed workers who may be impacted. According to the “Contractor Calculator” some such individuals will see their salary drop by 20% per year due to an annual increase in taxes and costs that will be between £3,199 (€3,480) and £7,500 pounds (€8,366).