Industry insiders have responded negatively to a consultation on the government’s latest IR35 proposal.
The proposal would see public sector organisations made responsible for determining the IR35 status of a contractor. Practically, this means that many more Personal Service Company contractors will be caught out by the IR35 legislation.
The contractors would be forced to pay tax as if they were traditional full-time employees, without enjoying any of the same employment rights and benefits.
Many inside and outside the industry see this as unfair. There is also a large amount of concern about some of the proposal’s unintended consequences.
The Freelancer & Contractor Services Association (FCSA) warned against leaving the decision to parties that will struggle to make an accurate IR35 assessment.