Feeds

IR35 protestors win first round of legal challenge

High Court sides with Professional Contractors Group

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

The High Court today gave protestors against the IR35 tax change permission to have it judicially reviewed. It is the first step towards getting the measure repealed, and the government demonstrated its intention to fight all the way by producing legal arguments against the petition.

The arguments, which gave a strong indication of the government's intended defence, were based largely on the belief that contractors and the like could not be considered businesses. They were given short shrift by the judge and a date of 5 February next year has been agreed with the Inland Revenue for a full High Court trial.

The importance of this date, as Gareth Williams, chairman of the Professional Contractors Group (PCG) told us, is that it falls before the end of the tax year. Even though IR35 is already law, if the three judges find against it, it will be struck out of legislation and those affected will not be required to pay the extra tax the measure demands. In essence, it would never have existed.

Williams said in a prepared statement: "IR35 is unfair and unworkable, now we are confident that we will prove that it is also illegal. The government decided to argue against our case today - and had its arguments thrown out. IR35 should now be suspended until this issue is resolved, and we ask the government to consider very carefully whether it should waste more tax payers money defending the indefensible."

Spokeswoman for the group Susie Hughes spoke to us from inside chambers and said: "We find it especially ironic that we are having to take the government to court in order to protect small businesses when it has said it wants to do everything it can to help them."

Mr Gerald Barling QC successfully argued that the PCG should be granted permission for a judicial review as it contravened European legislation. In particular that it is a form of illegal state aid to larger firms, that it goes against EU rules concerning free and fair trading and that it goes against the new Human Rights Act (confiscation of property).

IR35, if you don't know, basically treats contractors' turnover as salary, with the tax and national insurance implications that involves. Hence many people in engineering and the IT industry cannot make or retain a profit or offset equipment, training etc against tax. The government sees such people as exploiting a loophole, the contractors sees themselves as a prime example of free trade principles. ®

Related Stories

IR35 protesters play Human Rights card

Website security in corporate America

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
JINGS! Microsoft Bing called Scots indyref RIGHT!
Redmond sporran metrics get one in the ten ring
Driving with an Apple Watch could land you with a £100 FINE
Bad news for tech-addicted fanbois behind the wheel
Murdoch to Europe: Inflict MORE PAIN on Google, please
'Platform for piracy' must be punished, or it'll kill us in FIVE YEARS
Bono: Apple will sort out monetising music where the labels failed
Remastered so hard it would be difficult or impossible to master it again
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Found inside ISIS terror chap's laptop: CELINE DION tunes
REPORT: Stash of terrorist material found in Syria Dell box
Sony says year's losses will be FOUR TIMES DEEPER than thought
Losses of more than $2 BILLION loom over troubled Japanese corp
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Intelligent flash storage arrays
Tegile Intelligent Storage Arrays with IntelliFlash helps IT boost storage utilization and effciency while delivering unmatched storage savings and performance.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.