HMRC have published a consultation document for the intended reform to IR35 legislation.

From April 2017, the proposal would like the responsibility for applying the IR35 rules to fall to the Public sector agency or third party paying the worker. This will apply to individuals working under a Personal Service company (PSC) or their own limited company engaged with Public sector bodies, agency or third parties. Therefore, from April 2017, Taxes and National Insurance could be deducted before fees are paid.

The existing rules for IR35 will still apply when individuals are working through a PSC in the Private sector.

The consultation will run for 12 weeks starting on 26 May 2016 and closing on 18 August 2016.