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HMRC, HM Treasury and NHS Digital discuss off-payroll reforms

13 March 2020

Officials from HM Treasury, HMRC and the NHS will give evidence to the House of Lords Finance Bill Sub-Committee’s inquiry on off-payroll reform.

Witnesses

Monday 16 March in Committee Room 2, Palace of Westminster,

At 3.15pm

  • Lindsey Whyte, Director, Personal Tax, Welfare and Pensions, HM Treasury
  • Paul Riley, Director, Tax Administration, HMRC
  • Cerys McDonald, Director, Off-Payroll Reform Programme, HMRC

At 4.00pm

  • Carl Vincent, Chief Finance Officer, NHS Digital

Likely questions

Questions expected to be asked of the first panel include:

  • The Committee has heard evidence that since the IR35 rules were introduced 20 years ago they have not worked as intended. Why does the Government continue to pursue this approach?
  • Is HMRC planning to shift responsibility for operating the rules to clients because it has not had much success in enforcing the rules?
  • It is clear from evidence that the Treasury’s figure of £14.4 million for the one-off cost to business underestimates the true cost. How was this estimate worked out?
  • Some private sector businesses have reacted to the proposed changes by not engaging freelance personal service companies at all, and that others are blanket assessing their contractors as within the off-payroll rules. Will the disruption caused by such blanket assessments help or hinder the UK’s diverse labour market?
  • HMRC told the Committee that, by 2023-24, the reforms will bring in additional revenues of £3 billion – but that the loss that they are intended to protect against is £1.3 billion. Why are these amounts different?
  • Recent events, such as the coronavirus outbreak, are expected to have a significant impact on the UK economy. Should additional burdens on business linked to the reforms be avoided?

Questions to the second panel may include:

  • Was the implementation of IR35 in the public sector a success?
  • What did it cost to get ready for and implement the changes in 2017?
  • How in practice are the statuses of contractors being assessed?
  • Is the Check Employment Status for Tax (CEST) an effective tool?
  • How supportive has HMRC been in helping to understand the legislation?

Further information