IR35 Compliance 23rd August 2016 IR35: Proposals for off-payroll working in the public sector. HMRC has been consulting over the summer on reform of the intermediaries legislation, commonly termed IR35. The proposal, announced in the Budget 2016, is to move the responsibility for determining the tax status of engagements in the public sector by consultants and others operating through their own limited company, from the company itself to the public sector body, agency or other third party involved in the contractual chain between the consultant and the end customer. The consultation period closed last week and it will be interesting to see how the new legislation, which is due to take effect from April 2017, will look, particularly as some commentators have criticised the proposals as flawed, ill thought through, unnecessary, rushed and unlikely to achieve the increase in the tax take which HMRC is seeking. Watch this space! The proposals do not currently affect engagements in the private sector.