Early days, but any signs of where the new govt will fall on IR35?

[Dandyman]

Can we expect a greater leniency or even abolition of it perhaps?

[Stag Cozier]

Unlikely to be abolished altogether. I reckon they review it in a year when they decide to get round to it and possibly simplify it.

Think IR35 is going to be with us for a while

[Sally BFCA]

Can we expect a greater leniency or even abolition of it perhaps?

I wouldn't place too much hope on it being scrapped. Bearing in mind the state of the Government debt, they are going to want to glean as much money as possible. As IR35 hasn't netted them what they thought it would, they could put something far more scary in it's place. Something that has no grey areas and easy to administer, unlike IR35

[gingerjedi]

I wouldn't place too much hope on it being scrapped. Bearing in mind the state of the Government debt, they are going to want to glean as much money as possible. As IR35 hasn't netted them what they thought it would, they could put something far more scary in it's place. Something that has no grey areas and easy to administer, unlike IR35

I can see why that would be scary... for accountants.

[Wanderer]

they could put something far more scary in it's place. Something that has no grey areas and easy to administer, unlike IR35

It would be a vision of hell for contractors but taking the devils advocate position, why should people pay substantially less tax on dividends compared to income through PAYE?

Treat all income as income. No grey areas there, simples to administer.

[Sally BFCA]

why should people pay substantially less tax on dividends compared to income through PAYE?

Treat all income as income. No grey areas there, simples to administer.

Possibly because dividends are a reward for investment of share capital, not intended to be a structured part of remuneration as are commonly used by service companies

[Hex]

why should people pay substantially less tax on dividends compared to income through PAYE?.

The tax charged is actually much the same when you consider that dividends come from company profits which will have been subject to corporation tax in most cases.

The main difference is the national insurance. This is charged on income from employment and is not charged on investment income (interest, dividends etc.). The reason for this is that national insurance is supposed to pay for unemployment benefit, pensions etc and these are mainly employment related, so the national insurance was applied on income from employment. Nowadays it is just really another tax. It could be charged on investment income but that would probably make the government very unpopular with lots of people who have finished work and who rely on investment income to live.