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Friday, September 30th, 2011

Not for the first time this year I’ve found myself at odds with the current industry zeitgeist on IR35 as another groundswell forms calling for its abolition.

Last week, following a Freedom of Information request from the PCG, HMRC revealed that the tax yield created from IR35 in 2010/11 was only £219,180. During the same period there were only 23 reviews in which IR35 was considered to be a risk.

This downward trend of tax yield from IR35 has been ongoing for the last 5 years and its dividing opinion.

John Brazier, Managing Director of the PCG, believes that the low yields over the last five years mean that IR35 should be scrapped.
In his blog, Dave Chaplin of Contractor Calculator argued that: “The ever decreasing number of compliance reviews and tax yields over the last five tax years suggest that contractors have become savvy to HMRC’s current IR35 investigation tactics. HMRC intends to review its IR35 enforcement strategy as part of its work with the IR35 Forum, which could lead to specialist compliance teams targeting contractors with greater success.”
I partly agree with Dave in that contractors are now more savvy and it is for this reason that I believe IR35 should be kept and the PCG should be calling for this, not its abolition.

The current state of play, even though the actual IR35 legislation is infamously woolly, is something we are all used to working with now and contractors becoming savvier is a good thing.

If IR35 is replaced then its replacement could do more harm than good and end up costing the contractor community a hell of a lot more in tax.
Better the devil you know in my opinion.
Don’t forget, ClearSky Accounting is now offering IR35 reviews for non-clients as well as our own contractors.

Give us a call on 08000 325 326 for more information or advice.

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Friday, October 1st, 2010

There has been a lot of talk in the news recently about the coalition governments pledge to review the controversial IR35, although what form any review will take and any subsequent changes that will result remain unclear.

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Tuesday, September 28th, 2010

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Wednesday, July 28th, 2010

In the maze of information that is the IR35 legislation, contractors may well wonder where to start and how to go about assessing the law and what it means for them in practice. To this end, I’ve checked out some of the main sources of information and advice available over the internet and reviewed them for you.  Let me know what you think… Read the rest of this entry…


Friday, July 2nd, 2010

The coalition government went live with its ‘Your freedom’ website this morning, to much fanfare and Deputy PM, Nick Clegg, doing the rounds of the BBC’s various breakfast broadcasts.

The purpose of the website is to give the British electorate the opportunity to feedback to government on which laws and legislations they would like to see changed or removed all together.

Some commentators and opposition politicians have approached the ‘Your freedom’ website with a great deal of cynicism but for those of us in the contracting world, in which IR35 has loomed large for over a decade, it could be the best chance yet of having IR35 abolished, or at the very least simplified with added clarity!

The PCG has been campaigning for some time now to have IR35 abolished, and it’s fair to say the results have been mixed. I’ve spoken about the legislation being a focus point of a lot of politicking during the last election and there has been conflicting messages about IR35’s future in the press in recent weeks.

What can’t be denied though is the fact that contractors would prefer to see IR35 abolished and replaced with much clearer and transparent legislation.

Well if that is what you want, I believe the Your Freedom website is the best opportunity yet for us as an industry to speak out and we should be mobilizing to do so!

The PCG currently has around 20,000 members. The FCSA, of which our sister company Parasol is a founding member, looks after the collective interests of over 50,000 contractors, and if encouraged to do so, that is a lot of voices calling for IR35 to be abolished, something that the government will be forced to pay attention to.

At the time of writing there are already of 10 separate threads on the Your Freedom website discussing the abolition or replacement of IR35, citing its debilitating effect on small business and enterprise and bemoaning the relatively small tax yield it has produced in return. We will be adding our voice to that list and encouraging the contractors, agencies and business groups we work with to do the same.

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Tuesday, June 8th, 2010

Article First appeared on www.itcontractor.com on Monday, 7th June 2010

Eleven years on since its introduction, IR35 is still rarely out of the headlines and remains a huge bone of contention for contractors operating as a limited company and their service providers. The future of the legislation remains unclear, despite the new Government’s commitment to a review with the aim of simplifying the rules. However, Derek Kelly, managing director of ClearSky Accounting, warns the contracting world not to expect IR35 to be abolished but calls on the Government for clarification.

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Friday, May 28th, 2010

The ‘official agreement’  between the Conservatives and Lib Dems, published earlier this month, hinted at a number of business and personal tax policies, due to be confirmed in the Emergency Budget taking place on 22nd June. Our contractors are a savvy bunch, and on the whole, appreciate that the UK needs to address its massive budget deficit and this will involve more taxes; however, fairness and clarity will be key.

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Friday, May 21st, 2010

Comparing apples with pears – when comparing contractor accountants, make sure you are comparing like for like!

One of the things that constantly concern me about the contractor accountancy market is the lack of transparency by some service providers. This typically takes the form of a low headline monthly fee used to entice new business but which conveniently neglects to mention some of the expensive add-ons, joining/leaving fees and all the other additional costs that can sneak up on busy contractors who haven’t had the time to go through the small print in much detail. Read the rest of this entry…


Wednesday, May 12th, 2010

As the dust settles on one of the most compelling election nights in recent history and the new Prime Minister begins to assemble his first cabinet, the nation’s attention has begun to turn towards figuring out what it all actually means for them personally. Read the rest of this entry…


Thursday, April 1st, 2010

IR35 legislation is becoming something of a political football in the run-up to the election it seems, judging by Shadow Business Minister Mark Prisk’s comments in The Telegraph yesterday. Citing IR35 as another example of the Labour government’s “meddling with the tax rules”, Prisk called the legislation “over-complex, uncertain and often unfair,” and claimed it would be part of a fundamental review by the independent Office of Tax Simplification.

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