Contractors working for umbrella companies and limited companies gathered in Warrington earlier this month to give input to representatives from the Office of Tax Simplification (OTS) on impending changes to IR35 legislation.
In a workshop organised by the Freelance and Contractors Services Association (FCSA), contractors gave detailed explanations to OTS staff on their way of working and expressed frank concerns about potential changes to the tax system. Commenting on the event, FCSA’s chairman, Stuart Davis, said that his organisation’s members spoke freely, welcoming changes to the cumbersome IR35 legislation but also expressing concerns about continued uncertainty over how the new tax regime will affect the flexible workforce.
The workshop was hosted by Brookson, whose Managing Director, Martin Hesketh, also contributed. He said that many UK contractors know from experience that IR35 has been a “major headache” – its lack of clarity has made it exceptionally difficult for people to clearly determine whether they are captured by it or not.
By driving contractors to protect their self-employed status so as to ensure that they are not inadvertently caught by this legislation, they are often forced to do things “that are not helpful or supportive of the clients they are providing their services to.” He cited refraining from joint training activities and slowing down their response to client requirements in order to make sure that the appropriate documentation was in place.
As things stand with IR35, Mr Hesketh continued, contractors bear all the risks and employers and agencies bear none. He was speaking to the industry news outlet, Shout 99.