Greater HMRC flexibility could harm service provide sector warns FCSA
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Following a report in the Financial Times last week that HM Revenue & Customs (HMRC) intends to adopt a more flexible approach to resolving tax disputes with business, the Freelancer & Contractor Services Association (FSCA) has warned of the continuing need for strong enforcement.
Dave Hartnett, permanent secretary for tax at HMRC, told the FT: “HMRC is packed full of very intelligent people, but we are sometimes too black-and-white about the law.”
Responding to Harnett’s comments, Stuart Davis, chairman of the FCSA, says: “Non-compliance from service provider businesses undermines the credibility of the service provider sector and threatens the productivity of the UK’s flexible workers. I know that HMRC is trying to save money, but clarity and strong enforcement is needed to raise and maintain compliance standards.”
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Tom Atkinson Cash Simply. | Tue, 24 Aug 2010 3:01 pm
Staurt Davis is absolutely right. Where the rules are "black and white" (David Harnett's words) they should be applied with clarity and force for fairness.
However, much of the legislation surrounding "contractors" (e.g. IR35 and Chapter 9 stuff) is so broadly drafted that it is far from black and white causing confusion, worry, time wasting and costs for the tax payer. I am lead to believe that HMRC has wasted our money on over a thousand unsuccessful IR35 case for example. If they don't understand the tax laws, then what chance have we poor mortals.
What we need is not more or less enforcement but fewer "grey" laws and more "black and white" so everyone knows where they stand and where they stand, is on a level playing field.
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