The 21st century world of work has been shaped by people striving for a healthy work – life balance. Today, the life of the free agent is under threat with HMRC’s complicated IR35 legislation now under consultation for the Private sector. Read on to find out more.
IR35 – what is it?
HMRC’s IR35 legislation is aimed at targeting loopholes used by large organisations. In the simplest terms HMRC look at what actually happens in practice rather than terms of the contract between the contractor and the organisation they work for.
How successful is
IR35?
IR35 contracts have proven extremely unpopular with Public sector
employers and contractors alike. It is believed HMRC’s status test is too
complicated to follow and is blamed for the rapid drop in labour supply in the
NHS.
As 2020 deadline for the Private Sector implementation draws
closer the Public sector frustration is echoed throughout the offices of the Private
sector. Most organisations now factor in flexible working practices for
sustainable business growth.
How complicated is
IR35?
The debate is heating up following a number of high profile celebrity cases where Lorraine Kelly and more recently Kaye Adams triumphed over HMRC.
Both celebs argued the status test did not reflect in practice the work carried out under their contracts. Consequently, following the defeat in court HMRC has been accused of not understanding their own legislation – proving it is too complicated.
Whether you agree or disagree with the outcomes for Lorraine
Kelly and Kaye Adams both cases highlight the blurred lines of HMRC status
testing tools.
Many are arguing if those that wrote the legislation make
mistakes what hope does an ordinary contractor have.
How can contractors make living?
IR35 strikes fear into ordinary contractors simply trying to
make a living and for organisations managing labour. Without advanced tax
expertise a contractor could face an IFT Tribunal and not be as successful in
court as Kelly and Adams.
The bottom line is the onus is on the individual contractor
to prove your status to HMRC.
It is not all doom and gloom – we can help.
If you are confused by blurred lines and not sure if your status falls ‘inside’ or ‘outside’ IR35 then our Guide to IR35 Rules is a good starting point.
How Murrison &
Wilson can help with IR35 contracts?
Murrison & Wilson can fully prepare you.
Our resident tax expert Bruce Wilson, who formerly worked for HMRC, has helped GPs, IT contractors and other Public Sector workers make sense of IR35 sense of IR35.
So why not get in touch today so you can start your contract
tomorrow.
Get in touch today