HMRC 'too overworked' to deliver IR35 effectively

HM Revenue & Customs (HMRC) may not be able to implement IR35 effectively for people in IT contractor jobs, the Recruitment and Employment Confederation (REC) has warned.
Chancellor George Osborne is currently deciding on which recommendation to take from the Office of Tax Simplification, but according to REC evidence suggests that HMRC might not have the resources to deliver the stronger enforcement one recommendation would need.
Gillian Econopouly, head of public policy at REC, said with a further 15 per cent cut planned to HMRC's budget, it seems unlikely the authority would be able to provide the increased scrutiny required if IR35 was left in its current state.
"Both other options given by the OTS for IR35 reform - either suspending it altogether, or creating a clearer business test to automatically exempt large numbers of freelancers from the system - are far more workable, sensible solutions," she added.
REC's latest JobsOutlook showed that UK employers are still preparing to grow both their temporary and permanent workforces in spite of economic uncertainties.
