What is off-payroll?

Off-payroll is a classification for service providers who are paid by methods other than payroll, for example by issuing invoices for customers to pay. Off-payroll applies to freelancers, consultants and contractors. The term is commonly associated with the public sector.

Off-payroll in relation to IR35

Off-payroll has been a commonly used term in the discussion of the intermediaries legislation IR35. Under IR35, off-payroll workers are deemed to be employees in all but name and must be treated as workers by the engaging organisation.

While not as common, the term “off-payroll” has also been used in the private sector, particularly during HMRC’s consultation on IR35 in the private sector.

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FreeAgent's Chief Accountant Emily Coltman is available to answer your questions in the comments.