A tax expert has said that HMRC could be processing as many as 1,000 IR35 cases by the end of 2013-14.

Wednesday 27 February 2013

Up to 1,000 IR35 reviews could be in the works by the end of the next tax year, according to one expert.

Former HMRC employee Andy Vessey, currently of Qdos Consulting, said he sees no reason why every inspector across the three compliance teams based in Edinburgh, Croydon and Manchester could not feasibly have a workload of up to 30 cases each year.

However, he does acknowledge that some of the 36 staff will be researchers and data analysts rather than inspectors.

HMRC has already forecast that 230 reviews will be underway at the end of this tax year and promised the Public Accounts Committee the number would at least double in 2013-14.

Mr Vessey said that a Treasury report into off-payroll hiring in the public sector meant that there were other potential targets available. More than 3,000 interims and contractors were identified, many of whom are still employed.

Collecting evidence to prove that they are outside IR35 regulations is one of the most important steps contractors should take, Mr Vessey said, while they should also consider taking out a tax investigation insurance policy.

By Victoria McDonnell

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