He added: “HMRC will now need to update its Check Employment Status for Tax (CEST) tool that provides guidance on status matters, because in its current form it does not align with the law, and will be inadvertently giving users incorrect results that are inconsistent with this binding ruling.
“In the lead up to the now one-year delayed off-payroll reforms, which are due to come in April 2021, we saw many firms following HMRCs published advice and incorrectly classifying contractors as ‘employed for tax purposes’ where there was insufficient mutuality of obligation to justify that determination. Those assessments will now need to be revisited.”
IR35 currently applies to public bodies but is due to be rolled out to the private sector next year.
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