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IPSE: “unanswered questions” about government proposal for rolling in-year self-employed tax system
- 23 Mar 2021
IPSE, has responded to the government’s call for evidence on a new tax system for the self-employed. This system would replace annual self-assessment tax returns with a rolling in-year system. IPSE has said that although it welcomes the government’s concern with the tax experience of freelancers, there are still “unanswered questions” about the proposal that must be explored.
Andy Chamberlain, Director of Policy at IPSE (the Association of Independent Professionals and the Self-Employed), said: “We welcome the fact the government wants to improve the tax experience for self-employed people and we are keen to work with them on this. However, there are some unanswered questions about the proposal.
“First, many self-employed people’s incomes fluctuate substantially throughout the year – and while the current annual system accounts for these and ensures self-employed people pay the right rate, it is not clear how this would work with rolling in-year taxes. It is also not yet clear how this would work with late payments – which are a substantial problem for self-employed people.
“We would want to be satisfied this proposal would not pile even more of an administrative burden on self-employed people. There seems a risk here that rolling administrative tax responsibilities could be added to the requirement to complete some form of annual tax return – which would eat even further into freelancers’ vital working time.”
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