Sajid Javid Revoke IR35
Will Sajid Javid revoke IR35? A decade ago Sajid Javid called for the “repeal of the silly IR35 tax”. When he didn’t mention it in his Autumn statement cynical contractors were not surprised. However, he has now ordered a complete review of how HMRC has conducted its tax avoidance campaign against contractors since 2016. This was triggered by the loan charge problem.
Contractor Questions on the Sajid Javid Revoke IR35 Theme
- Will the Independent Inquiry of HMRC Include IR35?
- Does Sajid Javid Understand Contractors and the Flexible Workforce
- Is Sajid Javid’s Decision to set up an Independent Inquiry into HMRC a Surprise?
- Will Sajid Javid Revoke IR35 really?
Will the Independent Inquiry of HMRC Include IR35
Treasury papers show that the Chancellor is widening this to examine the way that HMRC has conducted the whole campaign against freelance tax avoidance since 2016. So it’s not just about the Loan Charge.
This seems to suggest that the independent inquiry will examine IR35 too. If this is a correct interpretation then this covers the period when the Government and HMRC rolled out the IR35 reforms in the public sector. That took place in April 2017.
It may also cover the looming IR35 reforms in the private sector too. These changes are due in April 2020.
Does Sajid Javid Understand Contractors and the Flexible Workforce
Sajid Javid understands contractors and how they contribute to the flexible workforce very well. He worked his way up to become Managing Director of Deutsche Bank. Deutsche were avid users of contractors in his time there and since.
Indeed it was when he had left Duetsche Bank and just before he started his political career that he made the statement that the Government should “repeal the silly IR35 tax”.
Is Sajid Javid’s Decision to Set Up an Independent Inquiry on HMRC a Surprise
The press are saying that his decision to set up an independent inquiry is a surprise. However, it is not such a surprise if you know his background and what he said about IR35 in the past.
He has appointed Sir Amyas Morse to lead an inquiry into all HMRC’s actions on contractors’ supposed tax avoidance since 2016.
I may be misinterpreting this and it may just be just about the loan charge. However, I don’t think I am. It could have said that hey were just investigating the loan charge. However, they didn’t. The Treasury papers said that they would look at the ways that HMRC conducted the whole campaign against freelance tax avoidance since 2016. That is the period just before the public sector IR35 reforms.
That surely has to include the IR35 reforms both in the public sector and the private sector. We await further clarification. I hope contractors group IPSE pushes them for further clarification.
Will Sajid Javid Revoke IR35 Really
I know many contractors will take this with a pinch of salt. However, there is now some hope that HMRC will be reined in a bit.
It could also recommend that the private sector IR35 changes should be examined at greater length.
Or it could recommend that the Government “repeal the silly IR35 tax” that Sajid Javid called for all those years ago.
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