Transport for London has become the first public sector body to react to April 2017’s incoming IR35 reforms by imposing a blanket ban on workers who operate through their own limited company.
Under the reforms, such bodies will -- for the first time -- become responsible for the difficult decision of assessing whether their limited company personnel are caught by IR35.
PHOTO CREDIT: MARC BARROT
Signalling issue: Limited company workers will hope that the London transport body’s pre-emptive response to IR35 reforms is not copied by other taxpayer-funded bodies.
But TfL is heading off both having to use an IR35 digitial tool, which is due to be released by HMRC to help end-users with the assessment, and from having to make the decision itself.
It is also saving itself from the unenviable prospect of penalties for a ‘wrong’ decision (one that HMRC disagrees with), as TfL will simply no longer have any ‘Ltd’ staff to assess.
“We won’t allow limited company workers to continue working for us,” TfL said in an internal memo, sent to some of its 2,300 off-payroll staff, but obtained by Moore News.
“The risk prohibits anyone who might be considered to come under IR35 continuing beyond 6th April”. The local government body added that “converting to PAYE or Umbrella worker status” would be required to continue work beyond April 6th.
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