With Chancellor Rishi Sunak due to make the Spring Statement in parliament tomorrow, many advisers to the independent contract sector have been suggesting that an announcement will be made extending IR35 to small companies.
Some industry insiders believe the extension of the framework which currently applies to PSCs supplying large and mid-sized firms, to be a done deal, believing that when HMRC hailed the new rules as “a huge success” it is a sure sign the rules will be extended to small companies.
Other industry players are not so sure, particularly with regard to timescales. Brian Stalley, co-founder of Outside Spy, remarked that “it took 4 years to extend the rules from public to private sector, so we would see it as premature to extend the rules beyond the current scope, when so much evidence is yet to be collected.”
Bauer & Cottrell co-founder Kate Cottrell agrees. “Lessons from the public sector 2017 rollout still very much need learning…one day small companies will be covered but not yet”.
Other matters affecting the contracting sector are also expected to be covered within the Spring Statement. Details on the Single Enforcement Body to regulate umbrella companies are widely anticipated. Many commentators have been calling for the scrapping of the planned April 2022 NICs increases, and the April 2023 Corporation tax reforms, but these are expected to be waived through.
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