Yesterday’s Budget saw George Osborne spelling out his plans to introduce a package of measures to tackle tax avoidance through the use of personal service companies and to make the IR35 legislation easier to understand for those who are genuinely in business. This will include:
- Strengthening specialist compliance teams to tackle avoidance of employment income
- Simplifying the way IR35 is administered; and
- Subject to consultation, requiring ofﬁce holders/controlling persons who are integral to the running of an organisation to have PAYE and NICs s deducted at source by the organisation by which they are engaged. (Finance Bill 2013).
The news saw contractors flocking to take the IR35 test at www.ContractorCalculator.co.uk, as numbers taking the test doubled with the following results:
Pass/Borderline pass: 35%
Borderline pass: 23%
Borderline fail/Fail: 42%
Dave Chaplin, CEO and founder of ContractorCalculator who devised the test said: “There are clearly some very worried contractors out there who have perhaps been sticking their heads in the sand. In light of yesterday’s announcement that HMRC is planning on using new processes and a dedicated team to enforce IR35, it is clear that contractors will need to ramp up their IR35 defences. Our test will help them to make confident decisions about their contracts and tax affairs.”
The new online IR35 tool is available free at http://www.contractorcalculator.co.uk/IR35_Test.aspx and has been developed to provide a highly accurate interpretation of a contractor’s employment status and will give a very clear answer, based on case law with all the factors considered. To design the test Chaplin and his team conducted extensive research and spoke to experts in employment law, contract law, taxation and IR35.
Chaplin concluded: “I would urge contractors to take the test – it will give them peace of mind and arm them with the facts to act accordingly.”
For further information:
Tel: 01273 475672
Mobile: 0777 937 2106
Note to editors:
ContractorCalculator is a leading independent website for the UK contracting industry – most of whom are highly skilled knowledge workers in information technology, telecoms, engineering, electronics, and construction.
There are 1.4 million such workers in the UK today who prefer to run their own businesses and work under contract rather than become employees of specific companies. Their contribution to the economy is crucial to keeping UK businesses competitive.
ContractorCalculator, which is independently audited by ABC, has over 130,000 unique visitors per month.
About Dave Chaplin
Dave Chaplin has lived and breathed contracting since he first took the plunge and became a professional contractor in 1997. He spent seven years working as an IT contractor in the City of London on critical, cutting edge IT infrastructure and development projects for global players. Dave is CEO of ContractorCalculator.co.uk which he founded in 2004.
That role has seen Dave consult with the Department for Business, Innovation and Skills (BIS), HM Treasury and HM Revenue and Customs on the future of IR35 and on tax simplification. He has become a contracting guru influencing a new generation of contractors through ContractorCalculator.co.uk, the Contractors’ Handbook and has been a regular participant in industry-shaping round-table events. Dave also lectures and presents on making a success of contracting.
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