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IPSE calls for optional freelancer tax structure to be added

The UK tax system needs to have an optional freelancer tax structure added to it, based on the recommendations of the awkwardly-named IPSE.

The Association of Independent Professionals and the Self Employed, which I liked much better when they were simply known as the Professional Contractors Group, have said that the time has come for an optional tax structure geared towards contract workers to be added to the British tax system. IPSE made the recommendation after the Treasury put out the call for suggestions to be submitted ahead of the Autumn Statement to be made by Chancellor George Osborne on 3 December.

The Treasury gave British individuals and organisations until 17 October to come forward with their proposals or ideas. IPSE has since outlined the recommendations it made during the comment period and has recently made them public, ostensibly to drum up grassroots support for its suggestions as the Autumn Statement creeps ever closer. The trade industry body submitted a raft of proposals specifically created to offer greater levels of support to freelancers, contractors and other self-employed Brits.

The IPSE suggested a new tax structure because the organsiation believes that it would make it clearer when it comes to determining employment status for freelance personnel. Electing to pay under the freelancer tax structure would not only reduce the burden placed on the self-employed, perhaps even obviating the need to have to take on a contractor accountant to navigate the snarl of red tape and bureaucracy most freelancers face when it comes to tax time. An additional benefit of the tax structure would be to exempt anyone from using it from being targeted under IR35, one of the most vile and mismanaged pieces of legislation to ever emerge from the Government. Or at least  think so anyway.

If you ask me this sounds like a brilliant way to ensure that Her Majesty’s Revenue and Customs gets its tax revenue every year without having to rake the nation’s freelancers and contract workers over the coals through artificial rule implementations like IR35. With HMRC so concerned with maximising tax revenue for the Treasury while also spending the least amount of time and money doing so, this could be a win-win situation for both freelancers and the taxman alike. Of course, there’s no knowing if the Government will actually listen to these IPSE proposals or not, but a man can dream can’t he?

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