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REC contacts HMRC over contract worker tax concerns

One contractor industry trade association has recently contacted Her Majesty’s Revenue & Customs over tax concerns within the recruitment sector, it has been recently reported.

The Recruitment and Employment Confederation has called upon HMRC to provide more effective and consistent rules enforcement when it comes to travel dispensation schemes for contract workers and other freelancers. The REC also called for simplified personal taxation rules for both contractors and their employers, according to Tom Hadley, the policy and professional services director for the REC.

Mr Hadley said that there are many things that the REC is engaging with HMRC, including a better way to implement IR35 rules for contractors that are self-employed. The trade association has major concerns with an HMRC proposal to move all ‘controlling persons’ into the employee category, with Mr Hadley adding that adding contract workers onto the payroll would act to undermine the flexibility that contract workers bring to business owners that need to control costs in the currently uncertain economy.

The REC official says that regulatory measures that are much too restrictive are not the best way to use the nation’s interim workers and contractors. Instead, Mr Hadley said, contracts and staff need to be managed soundly in order to pave the way for success, adding that one of the REC’s priorities is to work with HMRC on a constructive and regular basis, which will allow it to not just protect the flexibility that is inherent to contract working but also to aid in building a better jobs market.

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