Contractor accountants can pass on this welcome news for freelancers and sole traders from Mark Prisk, the small business minister. In a recent interview he said that the comprehensive review the coalition is going to undertake of business taxation will seek to replace IR35 with a long-term alternative.
The rules surrounding IR35 are continually changing and the new government wants to put in place a lasting settlement. The chairman of the PCG, Chris Bryce, is delighted by the news. Although there is still a lot of work to be done in order to find a fair settlement, he is optimistic that his organisation can work together with the government to achieve this.
George Osborne’s budget speech only contained one mention of IR35 when he confirmed that the tax would be reviewed, along with the small business tax, and that the government would release more details soon. It is expected that the review will be launched in the summer.
The coalition has committed to simplifying the British taxation system. They want to implement measures that prevent tax avoidance whilst at the same time ensuring that the self-employed do not face undue administrative burdens.
There are currently around 1.4 million freelancers in the UK who are governed by IR35.
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Image: a dilemma by Julia Manzerova
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