Following the PCG’s negative reaction to the government’s response to the House of Lords select committee on personal service companies, more industry and trade bodies have been giving their verdicts.

The Freelancer and Contractor Services Association (FCSA) was rather more positive, welcoming the government’s recognition of the importance of the UK’s flexible freelancing and contracting workforce. The body also welcomed the government’s recognition of the legitimate use of PSCs and the important role played by compliant Umbrella Companies.

Supporting the government’s commitment to strengthening and enforcing current legislation, FCSA chief executive Julia Kermode said: “We firmly believe that transparent and detailed compliance standards are the true differentiators between best and poor practice.”

While APSCo expressed concerns that HMRC had based its calculations on the costs and benefits of IR35 on old data from 2008/9 and 2010/11, it acknowledged that the government has a duty to ensure appropriate taxation and tackle avoidance.

APSCo’s head of external relations, Sam Hurley, also welcomed the government’s decision to temporarily postpone action on a select committee request to bring tax and NICs into greater alignment. Businesses, the government believes, are already adjusting to a raft of major reforms to payroll systems and should be given more time to make the necessary adjustments before additional changes are introduced.

Ms Hurley added: “APSCo continues to engage with HMRC through its work on the IR35 Forum, which is currently undergoing a review of a number of aspects of HMRC’s compliance activity regarding IR35, including the relevance and ongoing effectiveness of the business entity tests, the contract review service, and HMRC’s IR35 guidance.”

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