Other Changes to IR35

Other changes to IR35 effective from April 2021: Information requirements, status disputes and anti-avoidance


IR35 rules now require public sector clients, and, from 6 April 2021, medium and large private sector clients, to inform the entity they directly contract with and the freelancer or PSC of their determination (a “Status Determination Statement” (SDS)) with their reasons. Determinations must be made on an individual, not a blanket, basis.

All intermediary recipients of the SDS in the labour chain other than the client and the freelancer or PSC must pass the SDS and the reasons for it on to the person with whom they contract.

IR35 rules provide that where an SDS is issued that states that the freelancer is within IR35, a PSC can challenge it, and the rules provide for a “Status Disagreement Process” for resolving such disputes. Anyone liable to determine status who does not do so, or does so without taking the steps the rules require to ensure that the determination is carried out with reasonable care, or if they do not fulfil any other IR35 obligation, will be made liable for tax and NI, even if they are not the fee payer.

Please read our Guidance Note (which you can see here) for further detail.

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