In accordance with the sentiments expressed by Shadow Business Minister, Mark Prisk on his blog last week, he has now confirmed in a letter to freelancer group PCG that “a Conservative Government would undertake a fundamental review of small business taxation matters, including IR35.”
A source relayed to Contractor UK, that the Conservatives will pay due attention to any “IR35 simplification processes already in place.” The official announcement actually stated that IR35 would be a priority for a newly elected Conservative Government within their Office of Tax Simplification which would see tax experts working closely with the PCG.
In his letter to the group, Mr Prisk said: “We recognise and value the contribution of freelancers and we are well aware of the way in which the current Government has treated them. We want to deal with this problem comprehensively, in a way which provides us all with a lasting solution, not a short term fix.”
PCG responded: “We believe this solution has the potential to lead to a fairer and more workable tax regime for the vast majority of those who work freelance…however, will not be complacent. [We] will continue to make the strongest possible representations to any government of whatever colour after the Election to remove IR35 which is a grossly unfair and badly drafted piece of legislation.”
Speaking last week, Mr Prisk said of the proposed tax review: “Our aim would be to create a clearer, stable and lasting tax regime for the self employed and small businesses. As someone who was once self employed, I know how infuriating the IR35 rules can be. They are designed to stop tax evasion, but were introduced in such a clumsy way by Labour that they have affected millions of people who are acting perfectly reasonably.”