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IR35 compliance tightened

New statutory changes to IR35 compliance took effect this week as the government published draft tax legislation as part of the finance bill 2013.

Exchequer secretary to the Treasury David Gauke says the reforms will "deliver a progressive tax system that is simpler, affordable, fair and encourages growth".

According to ContractorUK the government will "put beyond doubt" that the 1999 IR35 regulations apply for "tax purposes" to contractors who are office holders of their end-users.

A spokesman for HM Revenue and Customs told the website that the changes were necessary because a "slight anomaly" in IR35 could mean it only applies to office holders solely for national insurance purposes.

In last week's Autumn Statement, chancellor George Osborne dropped proposals for the taxation of contractors deemed office holders, saying that IR35 would instead be strengthened to deal with the issue.


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