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FCSA responds to Government research on hirers becoming responsible for IR35

The Government released a report yesterday outlining the findings of a research study they conducted amongst hirers about the possibility of them becoming responsible for determining IR35 status for their self-employed workers.

Commenting on the findings, Julia Kermode, CEO of The Freelancer & Contractor Services Association, the largest independent trade association for accountancy providers and umbrella employers said: “It is clear and not surprising from the responses that there is a general resistance to the proposed shift in responsibility of IR35 to move from an individual to an employer or the engager.   Companies rely on temporary staff so that they can tap into flexible resources, skills and talent on an as needs basis – this saves money and lowers the risk to business.  From the research it is evident that respondents believe that HMRC is imposing yet another burden on organisations and passing the buck.  Respondents are calling for clarity, more information and a simpler test but given that there are 16 years of case law behind IR35 it is difficult to see how that would be possible.

The conclusions of the report are plain to read – businesses do not support these changes and FCSA echoes their views; any changes would be costly, burdensome, constraining and will ultimately undermine businesses and their relationship with self-employed workers.  As a result, businesses will use fewer freelancers or be forced to put them on the payroll and all parties will suffer.

“It is a huge concern because many of the firms who took part in this research reported that temporary staff have been central to their business success and at FCSA we have campaigned hard to make Government aware that the flexible workforce has been integral to the UK’s economic recovery, something that cannot be put at risk at the current time as we face the uncertainty of the impact that Brexit will have on our country.  Now is definitely not the time for change and, as this report concludes, change in itself is unwelcome when it bears no benefits for either business or the flexible workforce.  I hope that the Government listens carefully to the findings of this report and has a rethink.”

You can view the full report here