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Taxman not always treating contractors fairly, peers conclude

The House of Lords Economic Affairs Committee has raised concerns that HMRC is not always being fair in its approach, with contractors being particularly hard hit.

The committee recently published its ‘HMRC Powers: Treating Taxpayers Fairly’ report. In it, it voiced concerns about the way HMRC was using itspowers against largely law abiding taxpayers.

Lord Forsyth of Drumlean, the chairman of the committee, pointed out that some taxpayers were being hit harder than others. He said:

“Some of these powers disproportionately affect unrepresented and lower income taxpayers. We took some disturbing evidence on the Government’s approach to the loan charge. This is devastating the lives of middle and lower income individuals.”

He went on to point that often, these individuals were being required by their employers to use disguised remuneration schemes in order to secure employment. Effectively, they were being forced to become contractors. All kinds of organisations are now doing this, including the NHS.

As contractor workers, they then have to manage their tax affairs using the complex IR35 system – a model that places more of the tax and National Insurance burden on the employee than it does the employer. Some contractor and self-employment advocates say this situation will become much worse should the government’s planned IR35 changes come to fruition.

With this difficult tax landscape in mind, doctors’ accountants in Liverpool and beyond are working to better prepare their clients. At Wainwrights, we have put together a deal that enables our customers to secure membership of the IPSE, a self-employed support group, at a £50 discount.

You can take advantage of this offer by entering the code wainwrights50 when you sign up to become an IPSE member.

Posted by Mark
December 12, 2018
IR35

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