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2020 Predictions: Employment law changes on the horizon

Looking ahead, we look at some of the more significant legislative changes coming into force this April as well as some key cases due to be heard this coming year.

Statutory Changes

There are some key pieces of legislation which are due to come into force as of 6 April 2020. These include:

1. Changes to termination payments
Currently, if termination payments exceed £30,000, the excess is subject to income tax only.

However, from the 6 April, payments in excess of £30,000 will be subject to both income tax and employer’s national insurance contributions.

2. Introduction of IR35 to the private sector
IR35, aka the off-payroll working rules, apply to situations where a consultant seeks to provide their services via an intermediary, usually a personal service company.
Currently consultants are responsible for their own tax assessment. From 6 April, large and medium sized private organisations will be responsible for assessing the tax status of consultants and the entity which pays the intermediary will need to make the appropriate tax deductions.

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Get ready for IR35

Shoosmiths offers a range of services to help guide you through the IR35 tax obligations. Our national team of employment and tax specialists will work closely with you to understand your business model.



This information is for educational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given. © Shoosmiths LLP 2022.


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