What Will Become of IR35? Autumn Statement Reveals Future of IR35 Legislation

The build up to the Autumn Statement heard many contractor groups pushing for IR35, the single largest issue for contractors, be reviewed by the government once again. Widespread calls had been made for Chancellor George Osborne to either reduce its level of intricacy or alleviate some of the uncertainty that it tends to instigate. It was not seriously expected that any such modifications would be made to IR35, yet many who left the Autumn Statement expressed immediate fears that an unspecified legislation to combat fake self-employment was going to be brought about by an increasingly convoluted IR35 legislation.

However, the government has subsequently clarified that it is not their intention to make any such alterations to IR35, a fact that has both relieved and frustrated contractors in equal measure. This new disguised employment ruling is actually set to run alongside IR35, and the latter has been identified as an area that needs more rigorous policing in the future. HMRC are implementing a fresh new procedure when it comes to this, and this heightened level of scrutiny looks set to result in more people needing IR35 guidance than ever before.

To the relief of many, the government has expressed its intentions to clarify a widespread concern about what constitutes an ‘office holder’ under IR35, as this particular issue was identified as having the potential to create ambiguity when dealing with senior consultants. Yet this so called ‘strengthening’ of IR35 is still a degree short of the sought-after changes, and many are now losing faith that IR35 is ever going to be abolished or significantly reduced in complexity; despite the almost unceasing calls for such an action to be taken.

Some have claimed that it is ridiculous that contractors should be practically obligated to seek professional IR35 advice relating to the treatment of income for each contract, yet until this controversial legislation is substantially reformed such a precaution is really the only viable option. Here at ICS, we can outline to you exactly how IR35 is going to affect you as a contractor, and thus help you to determine your most accurate employment status. We have also compiled a full IR35 guide which gives in depth information relating to a comprehensive range of frequently asked IR35 questions. For more information about how ICS can help you, please do not hesitate to contact us now.