PCG calls on Chancellor to opt for IR35 abolition

PCG, the leading body representing the needs of the UK’s 1.4 million freelancers, today cautiously welcomed the Office of Tax Simplification (OTS) recommendation to suspend the discredited IR35 tax whilst working towards a permanent abolition.

This would come against a background of a long term merger of NICs and Income Tax.

Chris Bryce, PCG chairman and OTS Consultative Committee member said:

“Should the chancellor accept the recommendation to abolish IR35 this would be a major advance towards honesty, transparency and fairness for the freelance community.  We now wait for the Chancellor’s decision on the merger of NICs and Income Tax which will provide the basis for any reform.”

The report states that abolition is just one of three options put forward for reform. Alongside abolition, the retention of IR35 is also suggested with improved HMRC administration, as is the implementation of business tests to clarify IR35 further.

Mr Bryce continued:

“We have been telling the Government and all interested parties that IR35 was not fit for purpose. We now call on the Chancellor to opt to suspend IR35 with the view of permanent abolition.

“This would remove a shadow that has hung over the UK freelance community for over a decade and be a massive vote of confidence in this skilled and flexible community.

“PCG has worked tirelessly on the ‘business tests’ as another potential way forward. However keeping IR35 unchanged but with improved HMRC administration is not a valid solution to IR35 and PCG could not accept this.”

John Brazier, Managing Director of PCG said:

“David Cameron last week declared war on the enemies of enterprise, suspending IR35 would be one of the clearest messages the government could send in support of this statement.”

We thoroughly recommend following PCG’s updated feed on developments around the IR35 ruling throughout today.

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Written by Alistair Beech on March 10, 2011 and filed in Freelancers, News , ,

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