Contractors have been updated on the progress of the IR35 Review being conducted by the IR35 Forum and HMRC’s review. However, a key element of the review, the publication of new guidance on the gov.uk platform, has been delayed.
This is according to the minutes of the IR35 Forum meeting held on 10 February 2014, which also highlights that contractors who have undergone an IR35 investigation since April 2013 will be surveyed about their experiences.
The new IR35 guidance has been circulated to non-HMRC IR35 Forum members in draft form, and the minutes report that they were: “impressed with the general structure, content and style of the new guidance. It is a big improvement on the current guidance.”
A breakdown of the 2012-2013 yield from settled cases during the period was provided by HMRC, and the £1.1m total comprised:
- £985,901 of income tax and National Insurance Contributions (NICs)
- £97,500 of interest
- £34,555 of penalties.
Disappointingly, there were no further performance statistics detailing case numbers and turnaround times, and how they corresponded to business entity test scores, specifically for the period since HMRC introduced its new IR35 administration framework in May 2012.
ContractorCalculator has repeatedly requested this data under the Freedom of Information Act (FOI), to try to determine the effectiveness of HMRC’s new framework, but the taxman has refused to release the data.
“The minutes demonstrate to the contracting community that progress of a sorts is being made to evaluate the effectiveness of HMRC’s administration of IR35,” notes ContractorCalculator CEO Dave Chaplin.
“The minutes just published promise that the Forum will have discussed the full IR35 review report in the meeting on 7 May, and that the report should be seen to come from the Forum as a whole, and not just HMRC.”
Chaplin concludes: “We will be watching out for this crucial report and let’s hope that the review includes the performance data we have repeatedly requested and that it can be used as a tool to improve the experience of those contractors forced to endure an IR35 investigation.”