Key tax dates and deadlines for 2018/19
It is an inevitable reality that, for anyone earning a livin...
By Jonathan London on 13th July 2015
The Association of Independent Professionals and the Self Employed (IPSE) has issued a scathing verdict on the government’s Summer Budget for contractors, which it believes will cause more harm than good.
In a highly critical response to chancellor George Osborne’s first Budget of the new parliament, IPSE chief executive officer (CEO) Chris Bryce has suggested that the economic strategy laid out in the document will make life “much, much tougher” for those who run their own limited companies.
Mr Bryce condemned the new Conservative administration for retaining the controversial and unpopular IR35 tax laws, which is designed to curb instances of ‘disguised employment’.
IR35 has been criticised by IPSE in the past for having too much of a negative administrative impact on legitimate companies. Two previous reviews by a House of Lords Select Committee and the Office of Tax Simplification have found that IR35 is unclear, ineffective and should be removed or replaced, and IPSE has lobbied for its abolition, but the government has instead chosen to keep the system in place and overhaul it.
The consultation on travel and subsistence expenses announced in April’s budget speech, that could impact one-person limited companies and umbrella workers were also poorly received by IPSE, as it believes this will make it difficult for them to afford essential travel, thus limiting the reach of their services and their capacity for growth.
Mr Bryce noted that it will be particularly harmful for contractors people trying to compete against bigger companies, as they will no longer be able to offer their services to clients across the country in the same way that multinationals can.
Finally, concerns were raised over new rules that will mean company directors now have to pay 7.5 per cent more tax on any dividend payments than before, which Mr Bryce described as a “tax on entrepreneurship”.
The IPSE CEO said: “We have already lobbied senior government figures and spoken with other stakeholders who share our concerns. We will consult with IPSE members on the travel and subsistence proposals and robustly respond to the government’s consultation.
“IPSE is the voice of the independent contractor. And that voice will be heard loud and clear.”
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