Previously off-payroll freelance construction professionals operated through personal service companies which determined whether IR35 tax rules should apply.
But responsibility for determining employment status of freelancers has now shifted to the employing contractor.
Freelance workers fear losing out through higher tax payments while contractors could also face bigger bills from direct employment.
The changes were first due to come into force in April 2020 but were pushed-back due to the coronavirus outbreak.
Andy Chamberlain, Director of Policy at the Association of Independent Professionals and the Self-Employed, said that the changes to IR35 would do serious harm to the self-employed sector at the worst possible time.
He said: “The crucial problem with IR35 is still its complexity: in fact, it is so complex that HMRC has lost the majority of tribunals on its own legislation.
“Now the changes to IR35 are shifting this complexity from contractors themselves onto their clients.
“The result is clear: chaos. Many clients are pushing all their contractors inside IR35 – against the rules of the legislation. Many more are only engaging contractors through umbrella companies, while others are scrapping their contractor workforces altogether – just when, as the economy opens up, they will need them most.”