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| CURRENT SECTION :: IR35 / IR591 | UK's most visited IT Contractor Site - 250k unique visitors March 2008 |
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Small businesses were dealt a bitter blow today after the High Court upheld a controversial ruling in favour of the Inland Revenue. Gordon Stutchbury, an ex-police officer from Sunderland, backed by the Professional Contractors Group, had challenged a decision of the Tax Commissioners that, while he was acknowledged to be "in business on his own account", he must nevertheless pay tax as a "disguised employee" of his businesses clients. Stutchbury founded his company, Synaptek – a software consultancy in 1990. After the ruling, he had to pay more than 50% of his company turnover in tax. In a decision that has astonished the small business community, Mr Justice Hart dismissed the appeal. Gordon Stuchbury said "It is clearly disappointing and as anyone who’s ever run a business knows, this sort of confusion adds to the pressures and uncertainties. It’s almost impossible to run a business on that basis". PCG Spokesman David Ramsden said "This is a bitter blow for Britain’s freelance community. After three years of confusion, we are no closer to knowing who’s inside the legislation and who’s outside. We have always believed the government’s assurance that genuine businesses are not affected by IR35 and we will work with the government to clarify the position. Clearly today’s court ruling will be of great concern to small businesses throughout the country.” Leading tax consultant Dave Smith from Accountax said that the case underlined the importance of seeking professional advice at the earliest stage in any contentious dispute with the Inland Revenue. “This case, sadly, emphasises the pitfalls of self representation .” PCG have fourteen days in which to consider an appeal. Costs have been awarded to the Inland Revenue. Mar 28, 2003 Email this article Printer friendly page Previous Page
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