IR35 Forum considers new proposals

The latest meeting of the IR35 Forum looked at some new proposals to help contractors to establish their tax status.

A tiered test was among the suggestions put forward as a means of establishing self-employed status. It would involve the use of specific indicators to determine the level of HM Revenue & Customs (HMRC) intervention required, providing clarity to contractors.

The idea has been suggested in the past, but taking it forward will require much more in-depth discussion and the cooperation of HMRC, particularly when it comes to the type of indicators that should be used.

Gillian Econopouly, head of policy at the Recruitment and Employment Confederation and a representative on the IR35 Forum, commented: “We continue to work closely with HMRC and other expert groups such as the PCG, FCSA and ICAEW to drive operational improvements and provide clarity for self-employed contractors and the agencies they work through.

“The aim is to find clearer ways to establish the status of contractors and to dissipate the mist of uncertainty that has surrounded the IR35 rules.”

She added that the discussions are going to take time, but that the REC remains confident that it can deliver “genuine simplification for recruiters and the contractors they place”.