Contractors' Questions: False employment or self-employment, which is it?

Contractor’s Question: Incisive article on ContractorUK yesterday, but isn’t there a typo in the ninth paragraph where it says “false employment?” The term used by HM Revenue & Customs to describe what it’s targeting is, in fact, “false self-employment.”

Expert’s Answer: No, “false employment” is correct.

The point is that in their pursuit of an illusory, elusive perceived mischief, the Treasury and HMRC are demonising the soft target of an underclass of entrepreneurs who, as a result, may well end up having the worst of both worlds: being falsely taxed without their consent as if they were employees, but without even becoming entitled to any of the so-called benefits of employment. Hence my expression 'false employment.’ 

This move by HMRC and the Treasury needs to be exposed as the cheap political posturing that it is. Individuals who choose to accept the risks associated with self-employment need the incentive of the tax advantage rightly associated with that status, to compensate for that assumption of additional risk. Deprive them of that, and the country sends the message that they and their entrepreneurism are not welcome here.

If you are one of the many groups who stand to be impacted by this proposal, I urge you to consider responding to the consultation – ‘Onshore intermediaries: false self-employment’ - by email or in writing to:

Robert Burton
HMRC
1E/10
100 Parliament Street
London
SW1A 2BQ.

The expert was Roger Sinclair, legal consultant at Egos Ltd.

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Written by Simon Moore

Simon writes impartial news and engaging features for the contractor industry, covering, IR35, the loan charge and general tax and legislation.
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