Off-Payroll Working Guidance

The off-payroll working rules have been extended to medium and large private sector businesses as of April 2021. This guide outlines the key changes, responsibilities, and compliance requirements for construction businesses engaging contractors through Personal Service Companies (PSCs) or partnerships.
Created: 17 June 2024
Last Reviewed: 11 October 2024
Contents
Introduction
The Changes for the Private Sector
Exemptions for Small Businesses
Determining Employment Status
Providing a Status Determination Statement (SDS)

Introduction

Traditionally, contractors in the construction industry have provided services through PSCs or partnerships, simplifying engagement for private sector businesses. Previously, the responsibility for determining employment status and IR35 compliance lay with the PSC. However, as of 6 April 2021, these responsibilities have shifted, significantly impacting all parties involved in such contractual arrangements.

The Changes for the Private Sector

Public Sector Reforms

Public sector off-payroll reforms, considered successful, have been extended to the private sector for medium and large businesses.

Applicability

  • Medium/Large Business Criteria: The rules apply to businesses that meet two or more of the following:
    • Employs more than 50 employees
    • Turnover exceeds £10.2m
    • More than £5.1m in assets on the balance sheet

Responsibilities

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