Tax experts and industry bodies urge HMRC to rethink IR35 reform plans

Freelancers and contractors could be forced out of the public sector by planned changes to the way off-payroll staff are monitored, the government has been warned.

Tax experts and industry bodies have urged HM Revenue and Customs to reconsider its plans to switch responsibility to public sector bodies for applying an established but controversial tax rule intended to counter arrangements designed to disguise employment.

Amid claims that the change could lead to an exodus of contractors, HM Revenue & Customs told CSW that the “genuine self-employed” would not be affected. “This measure is about public sector workers paying the right tax,” a spokesman said.

Read more: My news story for Civil Service World, 19 August.

Watchdog highlights risks in HMRC’s digital transformation plans

HM Revenue and Customs will need to reassure the public that its new online systems are easy to use and secure – and management’s response when things do not go as expected will be a critical test of the department’s digital strategy, according to the public spending watchdog.

HMRC outlined its “Making Tax Digital” programme last December, but a series of consultations setting out detailed plans was delayed because of the EU referendum. Tax practitioners have expressed concern that the continued delay is increasing uncertainty for businesses, and some tax experts have called for the timetable to be reset.

A new report on HMRC’s accounts by the National Audit Office said the whole organisation will need to be transformed if it is to achieve its aim of becoming once of the most digitally advanced tax administrations in the world.

Read more: My news story for Civil Service World, 21 July.