HMRC has claimed that the impact of potential new regulations to block tax relief for supervised, directed or controlled (SDC) workers is likely to be minimal for contractors after receiving a poor response from flexible workers about the proposals.

The tax authority said that just three contractors had replied to the long-awaited consultation document published last week. Trade body All Umbrella Companies Are Equal (AUCAE) believes HMRC is wrong to think that SDC won’t have an impact on self-employed workers.

It is now urging contractors to fill in a form about SDC and how it could personally affect them so that HMRC can get a clearer picture of the implications if the regulations eventually come to fruition.

AUCAE spokesperson Lucy Smith said: “[SDC] will undoubtedly transform the contractor market. But if we don’t have statistics and hard facts to back up such a big, negative change, HMRC won’t listen.”

Every submission made by contractors will feature as part of AUCAE’s own response to the document and must be received before the deadline of 23rd August. The response will also be sent to Number 11 Downing Street.

Ms Smith added: “There’s going to be a potentially significant change for Umbrella Companies, PSC’s advisers, recruitment agencies and even end-clients, and it’s likely that change won’t be for the better.”

She continued: “So we urge all these parties and contractors themselves ‒ whether a PSC or Umbrella – to fill in the survey form so their views can be recorded, anonymised and then put to HMRC.”

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