Originally written by Timothy Adler on Small Business
Over half of the self-employed in Britain don’t know what IR35 is, despite being the people being most affected by it, according to research.
HMRC wants to bring thousands of freelance contractors who are effectively full-time employees within PAYE, in an effort to tackle what the taxman sees is “disguised employment”. Responsibility for assessing the tax status of self-employed contractors is due to shift from the contractor to the company that hires them.
The legislation, which has been heavily criticised by tax experts and business as being poorly conceived, badly implemented by HMRC and could reduce a worker’s net income by up to 25 per cent, is set to roll out in April 2020.
Accounting software provider FreeAgent surveyed 2,000 self-employed workers about small business taxation.
>See also: Small businesses call for HMRC to delay IR35 tax change
IR35 review
The Conservatives, Labour, the Liberal Democrats and Scottish National Party (SNP) have all pledged to review IR35 – although only the Lib Dems and SNP explicitly committed to a review in their manifesto.
Shadow small business minister Bill Esterson went further, announcing Labour would scrap IR35 being extended to the private sector before backtracking.
At the weekend, Chancellor Sajid Javid confirmed