Time to hit the pause button – our IR35 consultation response.
- 05 Jun 2019
- Ryan Barnett
IPSE, continuing two decades of our fight against IR35, responded to the government consultation with a damning indictment of this ill-conceived policy. Now we are making our response publicly available.
You may remember that the government held a major consultation on ‘Off-Payroll Working in the Private Sector’ last year. In our response, we detailed the extensive problems with the legislation, how we believe it will harm the private sector (supported by evidence from its prior roll-out in the public sector), and set out several recommendations. That response is also available in our policy pages.
In the recent consultation, we doubled down on our many criticisms of IR35 and the changes to it. For instance, there is still very little faith in the reliability of the CEST tool (used to assess IR35 eligibility). There are also still huge, unresolved questions about how the reform will affect employment status, as well as a big debate about who should be responsible for paying the Employers’ NI (hint: we don’t think it should be the contractor).
Although the reform comes into force in April 2020, we have yet to see the actual legislation, which makes preparing for the changes even more difficult. That’s why we’ve called for the implementation to be postponed. We have also called for the reinstatement of the five per cent expense allowance where IR35 does apply, and argued that the reasonable care clause should be put on the statute book to prevent blanket assessments.
Given the myriad of problems with the changes to IR35, before the government even considers extending them to the private sector, it should do a full impact assessment and also fully review the effects of the implementation in the public sector.
Read our full consultation response – including our 10 recommendations for the government – now. You can also visit our IR35 Hub for information on the reforms, what we are doing to fight them and what you as a contractor can do to prepare.
Meet the author
Economic policy adviser