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The Chancellor prepares for his Budget speech with his team
HM Treasury

IR35 delay added to £330bn virus aid package

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The government’s £330bn "Whatever it takes" response to the economic impact of coronavirus also brought comfort to freelancers with a 12-month delay to the IR35 off-payroll rules for private sector engagers.

18th Mar 2020
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Chancellor Rishi Sunak joined the Prime Minister at Tuesday's Downing Street press briefing to overhaul his £30bn Budget support package just six days after delivering it.

“I promised to do whatever it takes to support our economy through this crisis – and that if the situation changed, I would not hesitate to take further action. That is what I want to begin doing today,” said Sunak.

As well as enhancing and extending many of the measures announced last week, Chief Secretary to the Treasury, Steve Barclay announced in the House of Commons that the government was delaying the roll-out of the new private sector IR35 regime until 1 April 2021.

While a total of £330bn has been committed to support businesses and individuals, the IR35 delay came in response to growing calls for the government to offer support to the self-employed and freelances.

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Replies (19)

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By thomas34
18th Mar 2020 09:45

I'm sure Rishi Sunak will be grateful to Richard Murphy for his advice.

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By dstickl
18th Mar 2020 10:30

... such is the uniform rule of English law in Rotherham etc England, and its alleged abuse by our distinguished English etc legislators and/or rulers of law !!!!

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By AndyC555
19th Mar 2020 16:49

You should see Murphy's other demands.....

*guarantee funding to banks to ensure their survival, but on the condition that they are nationalised immediately without compensation
*Nationalise all the utilities (electricity, gas, water)
*Introduce food rationing
*new commissions are required, with emergency powers, on:
1) Recreating the economy after the demise of financial capitalism;
2) The future of land ownership;
3) The future of work;
4) The new social safety net, including for pensions, that we are going to need, which is linked to the future of tax;
5) Surviving the climate crisis that is to come;
6) Rebuilding our state so that it represents us all;
7) Preparing everyone for the world we’re going to live in by rethinking education;

I wonder if Murphy sees himself as having an important role in the new government of the Union of British Socialist Republics?

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By brandysnap10
18th Mar 2020 10:24

I'm interested to know what they are planning for other small businesses who don't fall into the retail, hospitality and leisure sectors.

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By ireallyshouldknowthisbut
18th Mar 2020 10:30

or indeed those without business premises.

or indeed what the delivery mechanism might be for those that do.

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By petestar1969
18th Mar 2020 11:51

So the vast majority of the support package announced yesterday was in the form of guarantees for bank loans? Encouraging people to get into debt is why the economy is already knackered and wasn't able to offer much resistance to the shock from this virus panic.....Great, NOT!

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By Michael C Feltham
18th Mar 2020 12:01

As already pointed out, a huge number of small businesses have no trade premises since they are based at home. Plumbers, decorators etc, cab drivers and various contractors.

The growing danger is the domino effect.

As staff are not paid, then they cannot debt service their borrowings, buy goods and services etc; then the suppliers of goods and services have to struggle to pay THEIR staff and so on.

As always, Government has failed to clamp down hard on lenders: with the lowest Base Rate ever, Credit Card rates are still around 29% APR! Small Business lending interest rates by banks is far too greedy.

SMEs represent circa 50% of GDP and employment.

Government will not be receiving tax revenues; local authorities will struggle with council Tax receipts; VAT will fall rapidly.

Since the UK is still massively over-borrowed in Sovereign Debt, yet the Buffoon and Sunak are proceeding to chuck public money around as did Gordon Brown.

A Three Month Mortgage Holiday is merely a bagatelle: if an obligor cannot pay, is thrown out of work (With tens of thousands of others!), then their chance of new real work is remote...

I believe in holistic terms of reference that sadly, banks and lenders as well as commercial landlords will have to share a significant chunk of the pain: either this, or the UK economy will implode.

Example:

https://en.wikipedia.org/wiki/Payday_loans_in_the_United_Kingdom

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By Ian McTernan CTA
18th Mar 2020 12:57

How about scrapping Section 24 permanently to help landlords who will soon be further hit with measures to protect tenants?

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By carnmores
18th Mar 2020 16:24

Oh how my heart bleeds for them

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By johnjenkins
18th Mar 2020 14:04

I am biting my tongue as I post this, but RM is spot on.
You can see the scenario develop. Loan for £20K but home taken as security. The rest we all know.
I do believe universal credit will be paying out a lot more.
Government receipts will be well down. No more money for MTD (perhaps).

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Jennifer Adams
By Jennifer Adams
18th Mar 2020 16:51

I'm going to say something controversial here and more in hope than anything else... dare we hope for a delay in MTD?

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By ireallyshouldknowthisbut
18th Mar 2020 17:03

I thought it was "no early than" April 2021?

Which is politician speak for "not happening any time soon"

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By Gone Sailing
18th Mar 2020 18:51

MTD is live - the soft landing year is nearly done - nothing to delay ??

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By johnjenkins
19th Mar 2020 09:13

Quarterly accounts (oops sorry updates)???????????

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By Gone Sailing
19th Mar 2020 17:11

Ah yes there is that - I had deliberately forgotten.

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By johnjenkins
20th Mar 2020 13:36

Or were you making sure we hadn't dozed off?

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By Gone Sailing
18th Mar 2020 18:53

Delaying IR35 has replenished our coffers for another year.

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By Sheepy306
18th Mar 2020 19:18

It will be interesting to see what happens here then. As many of our contractor clients have already either had their contracts terminated, been made full-time employees, or have accepted significantly lower day rates under the payroll rules, so I would imagine too late for the majority of contractors to do anything about and for the decisions to be reversed. A few of the contractor clients that were terminated are now struggling to find any replacement job as the banks understandably aren't keen on taking people on right now in the current unknown environment. I'm hoping that things unfold favourably.

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By Payroll Pete
18th Mar 2020 20:54

Also, if they have already accepted on-off-payroll conditions, ie PAY under an umbrella they can't go back as HMRC will come back in 3 years time and determine that you were within inside IR35 all along, cough up.

The people who have gone abroad aren't coming back.

The jobs the banks have already offshored to infosys, wipro, cognizant, accenture aren't coming back.

Dawn has cost the taxpayer a bundle. And it aint' coming back.

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