Tories may address IR35 and other 'unfair' business taxes

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Tories may address IR35 and other 'unfair' business taxes

Posted Feb 9, 2010

According to a recent press report, the Conservatives are looking at making the taxation system fairer for the self-employed should they win the General Election.

Potential Tory plans for small business taxation, outlined in the Telegraph last week, may include allowing one man limited companies to opt out of 'employment' altogether. Instead of paying the current 11% employees NI rate, they would be aligned with the 'self employed' who currently pay the £2.40 Class 2 weekly contributions.

Speaking to the paper, Shadow Business Minister Mark Prisk explained that the current UK tax system was unable to cope with taxpayers who were not traditional employees.

He said, "The current government has treated the self-employed disgracefully. More often than not they have treated them as if they are on the fiddle, which is wholly unacceptable..."

Unsurprisingly, IR35 was singled out as a particularly harsh measure by the Conservatives, given the compliance nightmare it has caused, and the way contractors in particular have been singled out for 'special treatment'.

The tax legislation was made to look even more ridiculous recently, after the PCG revealed that IR35 raises just £1.5m per year for the Treasury.

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