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The off-payroll working rules are designed to ensure that someone working like an employee, but through a company, pays similar levels of tax to other employees. It is fair that individuals who work in a similar way should pay broadly the same amount of tax. The rules do not apply to the self-employed or stop anyone working through their own company.
The reform to the off-payroll working rules does not change the rules by which employment status is determined but moves the responsibility for making the determination from the individual to the end client.
At Budget 2018, the independent OBR did not judge the forthcoming reform to have any specific macroeconomic impacts. This was reiterated in the Tax Information and Impact Note (TIIN) published in July 2019, which sets out HMRC’s assessment that the reform to the off-payroll working rules is expected to affect 170,000 individuals. The TIIN can be found here: https://www.gov.uk/government/publications/rules-for-off-payroll-working-from-april-2020/rules-for-off-payroll-working-from-april-2020.
HMRC have not seen evidence of organisations changing their recruitment practices to hire contractors offshore. Organisations will continue to be free to decide how they engage their workers and it will be for those workers to decide whether they wish to accept the terms and conditions offered.