New tax rules threaten innovation Proposed changes to off-payroll tax rules could seriously damage British innovation, the Association of Independent Professionals and the Self-Employed (IPSE) has warned. CEO Chris Bryce commented: “Recent research shows how crucial freelancers are for companies to create, innovate, improve productivity and compete on the global stage. Extending these rules will put a huge extra burden on organisations which depend on the use of highly-skilled flexible workers to help them succeed.” Changes to IR35 rules mean companies will have to determine the status of contractors. In the public sector, employers have sought to avoid potential penalties by simply classifying every contractor as being inside IR35. But Dave Chaplin of ContractorCalculator says the rules mean those judged to be within IR35 are taxed on a level with employees but do not receive associated benefits such as holiday and sick pay or pension contributions.