IT contractors and freelancers from across multiple industries gathered outside Parliament today to protest the government’s impending IR35 policy, which is set to forever change how they are taxed and quite possibly, employed.
Among their demands: that Chancellor Sajid Javid pause the changes, set to be effective from April 6 onwards. (See our previous reporting here and here).
Computer Business Review was at the scene and talked to Dave Chaplin, CEO of Contractor Calculator and director of the Stop the Off Payroll Tax campaign.
He said: “The intention is to tax freelancers as if they were employees – without giving them any rights whatsoever. We are asking the Chancellor to sit down with us and come up with a more sensible way to recognise freelancers in the tax system.”
A HMRC spokesperson insisted to Computer Business Review that it has “put various measures in place to make sure that contractors and businesses know what is happening, what they need to do, and have dedicated teams providing education and support.”
They added: “The change to the long-standing off-payroll rules ensures the correct tax and National Insurance contributions is paid by shifting responsibility for employment status decisions from workers to the organisations they work for. The change does not affect people who are self-employed under existing employment status tests and will ensure that tax that was always due is paid.
“Contractors who are complying with the existing rules will feel little impact.”
IR35 Protestors Disagree
The feeling on the ground outside of Parliament today suggested few are persuaded that things are this straightforward.
And a large number of the protesters are afraid that they will be suddenly unemployed in the coming weeks and may have to leave the UK.
One financial services sector IT contractor told us that not only is he worried that he will not have a job in four weeks, but he believes that the UK will experience a massive brain drain as a direct result of this policy.
Commenting on a Computer Business Review LinkedIn page, meanwhile, another, Ashley Narayana said: “We are happy to pay our taxes – we’re very careful to do so in fact. What we resent is that those using PSCs are being forced into umbrella/IR35/perm when it’s absolutely not necessary.”
He added: “I was working in the public sector (local council) as a contractor when the changes hit. Compared to the private sector where agility, headcount and delivery all directly impact the bottom line, the laziness around preparing and mitigating the changes was tragically evident. Instantly, we were all declared inside as nobody could be bothered to update frameworks or read around the subject.
“As a result, a £20 million project tanked and all the contractors did indeed leave for private sector contracts. That project was funded by taxpayers.
“The government needs motivated, skilled contractors and the elastic capacity to skill up and skill down to deliver quality projects without retained headcount and they proved that by p*ssing away this shameful quantity of public cash.
“I live in hope that shareholder profit-driven enterprises will be far more diligent in mitigating these changes with robust frameworks…”