Can you explain the IR35 Offset Rules coming into effect in April 2024?

Contractor asks:

Can you explain the new IR35 offset rules that are coming into effect next April? How will they impact my business and the wider contractor market?

Acumenica answers:

At the moment, if an outside IR35 ruling is successfully challenged by HMRC the deemed employer has to pay back the tax and NI owed. But the tax paid by the contractor’s ltd co aren’t off-set against the liability resulting in a double taxation. The changes will allow the offset.

This reduces the end client risk so might well lead to an increase in outside IR35 determinations.