Chancellor Pledges Review of IR35 Changes

Chancellor Sajid Javid is promising to review looming freelance tax rule changes which are causing widespread concern in construction.

HMRC IR35 rules are due to change next April making contractors liable for determining the tax status of off-payroll professionals.

Major contractors have been auditing freelancers employed via personal service companies as thousands of professionals are braced for a move back to PAYE.

But Javid told the BBC Radio 4’s Money Box programme “We’ve already said that we’re on the side of self-employed people.

‘We will be having a review and I think it makes sense to include IR35 in that review.”

Current rules allow workers to be employed via a personal service company (PSC) which determines whether IR35 tax rules should apply.

That responsibility is due to shift from April to contractors who will determine employment status.

Freelance workers fear they will lose out through higher tax payments while contractors will also face bigger bills from direct employment.

One industry expert said: “They are desperate for any vote they can get so alienating a million freelancers is not a good idea.”

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