Lords Report Leads to Calls for IR35 Suspension

IR35According to a report from the House of Lords, HMRC must better justify the continued existence of IR35. On the heels of the report, stakeholders began calling for the legislation to be suspended.

The law is aimed at preventing people from lowering their tax through avoiding direct employment and instead being taken on as independent contractors. The law has been the subject of great controversy over the past few years. In the 2012/2013 financial year the number of IR35 investigations grew fourfold, according to figures released last month. That year saw 256 cases, compared to the previous year’s 59.

According to PCG, a membership organisation for freelancers and independent contractors, it would be desirable if the law were suspended with a view to complete abolishment. According to Chris Bryce, the organisation’s chief executive: “Removing this unnecessary legislation will allow the UK’s flexible workforce to do what they do best – boost British business.”