The Freelancer & Contractor Services Association (FCSA) has welcomed an appeal by governmental bodies calling on HMRC to delay the public sector IR35 changes due to take effect on 6th April.
The Local Government Association (LGA), Chartered Institute of Public Finance and Accountancy (CIPFA) and Society of Local Authority Chief Executives (SOLACE) jointly issued a statement to delay the legislation changes until the confusion surrounding them has been resolved.
HMRC’s Employment Status Service (ESS) is now in public beta testing and will be officially ‘live’ sometime after. HMRC will not stand by outcomes while it is still in test mode, meaning that the public will finally be able to access the tool, but not necessarily rely on the results initially.
Julia Kermode, Chief Executive of the FCSA, said: “Our sector is in disarray and the continued absence of HMRC’s digital employment status tool means that it is impossible for hirers in the public sector to get HMRC’s view of the IR35 status of their contractors. This is why we are seeing sweeping decisions being taken by some public sector bodies banning all workers who operate through their own limited company.
“Many contractors are simply deciding to leave the public sector, or seeking an increase in their rates, which in turn is exacerbating skills shortages and financial pressure in an already stretched public sector. HMRC has always said that these new changes would only affect non-compliant contractors, and would not impact on the flexibility of the workforce both of which are incorrect and not what we are seeing in reality on the ground.”