Contractors Welcome Scrapping of IR35 Tax Guidelines

The coalition government's decision to axe the infamous IR35 tax guidelines has been welcomed by IT contractors.

Contractors believed the tax guidelines were more of a hindrance than an effective way to tackle tax frauds.

The IR35 tax guidelines, which came into effect in 2006, were designed to cover a loophole that let IT contractors work as full-time employees in any organisation while avoiding paying tax or National Insurance contributions.

The Professional Contractors' Group (PCG), the UK's largest independent union for IT contractors, said it was "delighted" bythe new government's decision to abolish IR35.

Many IT contractors were opposed to the legislation when it was introduced, claiming the process of complying with the guidelines was time-consuming, and left them confused as to who they applied to.

A spokesperson for the PCG said: “Few will lament the passing of IR35 when it is finally confined to history. It was badly drafted and created massive and unjustifiable problems for contractors.”