IR35 replacement ''should unlock contractors'' potentials''

Contractors'' potentials should be unlocked by any replacement for IR35 legislation.

It is crucial that any replacement for IR35 fully unlocks the potential of entrepreneurial contractors, an expert has claimed.

Dave Chaplin, chief executive of Contractor Calculator, has highlighted the importance of any replacement legislation closing the loopholes that allow people to abuse Britain's tax system.

He said that the fact contractors are often highly mobile means that the correct balance must be struck between taxing these workers and pushing them into leaving the UK.

"The replacement of IR35 presents a fantastic opportunity to unleash the contracting workforce from the current stifling burden of legislation that could potentially generate much more benefit to UK plc," he asserted.

Mr Chaplin claimed that the growth in sectors such as engineering, oil and gas, offshore and energy is likely to create a lot of contractor opportunities and a change in IR35 legislation could help to keep these workers domiciled in the UK.

Earlier this month, Office of Tax Simplification tax director John Whiting told Taxation that the fact that this legislation is being reviewed should not be interpreted as showing a definite intention to repeal it.