A specialist in IR35 tax regulations has stated that he is expecting HMRC to make more mistakes in the future as changes to the rules on off-payroll payments come into effect.
Qdos CEO Seb Maley was making reference to the recent webinar from HMRC on the IR35 changes that contained at least 25 mistakes, and he warned that they would almost certainly not be the last made by the tax authority. These errors were pointed out to HMRC, leading to a defensive response, but Maley went on to say that it was correct for contractors to highlight them with the rule changes now coming into force.
Maley then continued by saying that many contractors are making use of the CEST online tool provided by HMRC to figure out whether they fall inside or outside of IR35 under the changed rules. He argued that this is a problem, as the tool is not thorough enough.
Speaking to Contractor UK, he explained that:
“CEST asks up to 30 questions before delivering an answer regarding a contractor’s status. In contrast, when policing IR35 compliance HMRC can ask more than four times that amount – 134 in a current case we’re working on.”
This is one reason why it can be a sensible move for contract workers to get help from someone qualified to understand the changes, like an accountant who deals with tax return services in Goole or wherever they live.
The changes to the IR35 regulations are set to be applied from this month.