Sunak urged to suspend tax changes

Posted on 03 Jan 2014
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Sunak urged to suspend tax shake-upNew Chancellor Rishi Sunak has been urged to suspend a huge tax shake-up for self-employed workers, with warnings that it could cause “enormous damage” to contractors. The Recruitment & Employment Confederation (REC) and the Association of Independent Professionals and the Self-Employed (IPSE) have warned of confusion over complying with the new IR35 rules, with changes coming into force in April in an effort to clamp down on tax avoidance by “disguised employees”. The IR35 employment status is currently declared by the contractor but the reforms will shift the responsibility to businesses. Concern over the switch has prompted some firms to say they will stop using contractors, while a survey by IPSE shows that a third of self-employed workers say they will stop freelancing. Neil Carberry, chief executive of the REC, said “lots and lots of companies” are unsure about how to abide the new IR35 rules, while Andy Chamberlain, deputy director of policy at IPSE, said “IR35 rules, when they apply and don’t apply, are so complex that no one understands them, even HMRC”.

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