Government 'avoiding IR35 issue'

Posted on 26 November 2008

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The Professional Contractor's Group (PCG) has spoken out against the government's decision to ignore the burning issue of IR35 legislation in the pre-budget report.

According to the organisation, IR35 legislation – which was introduced in 1999 to combat the avoidance of tax and National Insurance payments through the use of intermediaries – is unfair to contractors and unworkable.

PCG managing director John Brazier reiterated his existing stance on the rules, which he claims continue to place freelance workers in "appalling difficulties".

He said IR35 imposes significant costs, makes it impossible to self-assess with any certainty and allows HMRC to mount "unjustified attacks" on law-abiding taxpayers.

Mr Brazier added: "The government's refusal to admit that it was wrong and remove this burden on small businesses is unforgivable."

Some 65 per cent of PCG members polled in a recent survey cited IR35 as a problem, with 40 per cent claiming it to be the most significant problem they face in the course of their employment.

Category: Tax & Legislation News

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