HMRC leaks its own IR35 off-payroll guidance in online 'publishing error'

HMRC yesterday let slip its much sought-after guidance on off-payroll working in the private sector, only to ‘un-publish’ it a few moments later and replace it with a blank screen.

Other than white space where the guidance was live momentarily, mid-morning visitors to HMRC’s Employment Status Manual site could only see: "Guidance withdrawn 3 Feb 2020."

Underneath the message -- displayed by clicking 33 new draft HMRC guidance manuals (titles still visible), a clearly up-against-it HMRC spluttered: ‘Will be republished in due course.’

By the afternoon, the six words were replaced with: “HMRC is committed to publishing an updated employment status manual reflecting the April 2020 reform changes as soon as possible.”

'Publishing error'

Asked what happened by ContractorUK, a HMRC spokesman responded by reading out the very same statement, but then admitted the ‘update’ was due to a “publishing error.”

Belinda Johnson, boss of employment research firm Worklab reflected: “I guess someone [at HMRC] pressed the button too early! It’s a pity -- there are some useful-looking headings.”

Status advisory Re Legal Consulting confirmed: “We didn’t screen-shot the guidance because we didn’t think HMRC would whip it away quite so quickly! But it’s very frustrating.

“The manual headings are there, but no content. These headings are on IR35 reform aspects we haven’t been able to get answers on [from HMRC]. So we wait with baited-breath.”

In the new IR35 legislation from April 6th, provisions around ‘Reasonable Care’ are what PSCs’ advisers are keen to know more about, since HMRC committed to make clarifications.

So, many will be pleased that the duty on engagers is the entire focus of one of the leaked HMRC manuals  -- ESM10014, entitled “basic principles” in relation to “reasonable care.”

'HMRC's example says clients should not be blanketing'

And not just leaked, but screen-shotted too. Paul Lloyd, a director at Brookson, summed up what the manual states in a section headed "Example of a client not taking reasonable care."

“[It’s] interesting to note the [HMRC] guidance on 'reasonable care' and why client[s] should not be blanket banning," he begins.

“Examples of behaviours which do not constitute reasonable care [according to the example] include, but are not limited to:

“Determining that every worker who provides their services through an intermediary is caught by the off-payroll working rules without giving any consideration to the specific facts of each individual case.

“[And] determining that the off-payroll working rules apply to a large group of workers who have some variations between the work that is being carried out, without giving proper consideration to the different working arrangements for each worker.”

'A client duty to withdraw the SDS'

Other “draft” HMRC manual headings cover Status Determination Statements (ESM10012), and a client’s “duty” to withdraw their SDS if it ceases to be medium or large (ESM10016).

But now, all the draft materials from the Revenue will likely need to stay under wraps, until the IR35 Reform Review, chancellor Sajid Javid and Budget 2020 each have their say.

If not, says one of its former inspectors, the tax department risks undermining their decisions or upstaging them. And either could be more damaging than a mere ‘publishing error.’

“It would be wrong to publish [these manuals] ahead of the so-called ‘review’ and arguably ahead of the Budget when the decision on it all belongs to ministers,” the ex-tax officer said, adding: “Actually, it would look pretty bad to publish a massive ‘draft’ update at this stage, unless the decision is held by HMRC -- which of course they cannot claim it is.”

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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