HMRC is set to raise awareness and build up the profile of the IR35 legislation.
IR35 is a very important topic, and is relevant to a large number of contractors in the UK. Despite its significance, however, there are some that are still ignorant to HMRC’s legislation. Not only do limited company contractors themselves often underestimate IR35, but service providers and end clients are at times unaware of the legislation’s importance and potentially devastating outcomes.
What is IR35?
As a result of this collective ignorance surrounding IR35, the Revenue are determined to raise its profile and increase awareness.
The IR35 forum minutes were published last month, giving the public an insight into the discussions surrounding the much-maligned legislation.
IR35 Forum Minutes
Of the many topics discussed, raising the profile of the legislation was considered vital, as promoting its awareness and encouraging understanding would give those involved within the contracting world a greater knowledge of compliance and professional status.
The IR35 Forum have discussed at length ways in which IR35 awareness can be better promoted, and the legislation itself better publicised throughout the contracting sector. Although a number of sectors seem aware of the IR35 rules (IT seems relatively savvy) and other groups of highly paid freelancers take IR35 into consideration, the Forum suggested that many other areas should be more aware of the legislation.
As has been said before, there was increasing concern that a number of accountancy firms that do not either understand the legislation, or refrain from advising new clients that they have a potential back-dated tax liability. The number of contractor accountants claiming to be ‘specialists’ in IR35 has risen dramatically in recent years, but as IR35 is such an increasingly important topic, accountants are warned that their self-professed ‘expertise’ must be built on proper training or sufficient experience.
The Forum has deliberated numerous ‘creative’ ideas about how to raise the profile of IR35, discussing hard copy manuals and brochures, but what was agreed on was that the guidance which is currently available via the website was not sufficient or ‘user-friendly’, and was therefore in need of revision.
HMRC’s IR35 Page
As to how HMRC will actually go about re-vamping IR35 and promoting compliance, we will have to wait and see, but it has been highlighted numerous times that despite the legislation’s genuine significance, there has been little help from HMRC themselves as how best to protect oneself. Will ‘raising the profile’ of IR35 have a positive impact on our self-employed workforce? Or are HMRC simply re-packaging legislation to further enforce its rules.
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