The end of the IR35 grace period

Following the implementation of the new IR35 off-payroll rules in the private sector, the HMRC grace period has now ended.


On 6 April 2021, the new IR35 off-payroll rules came into effect in the private sector bringing it in line with the public sector, where IR35 off-payroll rules were introduced in 2017.

Following the implementation, HMRC announced a 12 month grace period for businesses to adjust to the new legislation. This meant that HMRC would not issues financial penalties to businesses for inaccuracies during this period, except for when there was evidence of deliberate non-compliance.

On 6 April 2022, this grace period came to an end.

Businesses should ensure they don’t rely on only one or two of the key IR35 factors in solation (i.e. including mutuality of obligation, control, and the level of personal service (such as the right of substitution)­ when making IR35 determinations. Pursuant to recent case law, whilst those factors may be present, the assessment should be made looking at all of the facts and circumstances in the case i.e. looking at ‘the whole picture’.

For further information on IR35 you can check out the Insights section of our website which has a wealth of information covering the IR35 off-payroll changes.

Need help?

If you require further help, please do contact Marie Pegram on 01462 687333 or by email

Recruitment Accountants have recently partnered with Qdos contractor who can provide support on status determination statements and insurance. Should you wish to find out more and receive a discount on Qdos services please contact Marie Pegram.

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