Tories promise IR35 review
Conservative shadow business minister Mark Prisk this week promised to review the IR35 tax regime for personal services companies.
In a letter to the Professional Contractors Group (PCG), Prisk wrote, “A Conservative Government would undertake a fundamental review of small business taxation matters, including IR35.”
In an election undertaking that will appeal to 36% of the AccountingWEB members who took part in our pre-Budget poll, the Tory business spokesman added that the IR35 review would be a priority for a new Office of Tax Simplification.
The controversial IR35 measure, named after the 1999 Budget press release in which it first appeared, has come to symbolise New Labour’s uncomfortable relationship with contractors, freelancers and small business owners it thinks are exploiting loopholes to avoid paying income tax and National Insurance Contributions on their earnings.
Sensing the potential for votes from an influential constituency Prisk told the PCG, “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.”