HMRC – pledge to increase IR35 investigations

HMRC promised to increase their enforcement activities following a damning Parliamentary report, 10 years after its introduction.

The influential Public Accounts Committee (PAC) took a swipe at freelancers as it examined the recent much-condemned practice within the public sector, particularly some Government Departments and the BBC, of paying some of their senior workers via their own companies to reduce tax and NI bills.

The Government is now to put its house in order concerning the so-called ‘off-payroll’ conditions. Firstly, it tightened up the way it contracts with freelancers; then private companies were told to do the same if they wished to contract with Government; and now the PAC has lambasted Government and the BBC for its reliance on freelance and interim worker who ‘presents a risk to value for money’; and condemned HMRC for its lack of IR35 investigations. As a result, HMRC is to increase the number of IR35 investigations ten fold next year.

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