IR35 tax fails to bite
Hugely contentious tax on contractors raises just £1.5 million a year
The controversial IR35 tax is barely paying its way, and has raised just £9.2
million between the 2002/03 and 2007/08 financial years.
The employment tax was introduced as a means of treating certain contractors
as though they were employees of their clients.
Contractors who pay the tax have found that it reduces their take-home pay by
up to 25%.
The Professional Contractors Group obtained the figures from HMRC under the
Freedom of Information Act. The government has earlier declined to answer
questions raised in Parliament as to how much revenue it earned from IR35.