The Government’s Finance Bill published today, confirms that the government plans to go ahead with the implementation of IR35 in April 2020. Sadly we feel that the government has not taken on the strong recommendation to put its IR35 plans on hold to allow a comprehensive impact assessment, and to remove the exemption of small businesses. We feel the draft legislation risks damaging the UK’s productivity and labour market flexibility at a time when it is most needed.
We are finding that the IR35 rules are a huge problem for employers and contractors alike. We feel that with some businesses relying on contractors, adjusting to the requirements will be a considerable administrative and financial burden. Making sure everyone pays the right tax is essential, but the rules need to be clear to be effective. The last thing private sector businesses need at this time of Brexit uncertainty, is rushed or poorly-designed tax rules that add further uncertainty to an already fragile business landscape. We respectfully say that there is still time for the government to reconsider its choices and delay changes to IR35 until at least April 2021.
