Almost three quarters of UK freelancers and contractors have revealed that tax protection and IR35 insurance is either ‘vital’ or ‘fairly important’ to their business, research has highlighted.
Recent and potential changes to the tax system and IR35, along with constantly evolving employment law means that as well as general business insurance, the UK’s independent workforce is now taking further measures to protect itself from tax and IR35 investigations.
Changing tax legislation led to 63 per cent of contractors surveyed to urge the Government to prioritise building a fairer tax system, and one that works for the self-employed, not against them.
Highly-skilled UK contractors have now revealed the importance of tax and IR35 insurance in what are arguably uncertain times: Tax investigation and or IR35 insurance is ‘vital’ to 35 per cent, 39 per cent see tax insurance as ‘fairly important, 18 per cent believe tax and or IR35 insurance is of ‘average importance’ and 8 per cent are not concerned by insurance, seeing it as an ‘unimportant’.
Seb Maley, CEO of Qdos Contractor and The Qdos Group’s Insurance Division, commented on the findings: “Forever changing tax legislation and the increased threat of being found inside IR35 or facing a tax investigation by HMRC have unsurprisingly led to a rise in the number of contractors actively looking to protect themselves with tax and IR35 insurance.
“That 74 per cent of contractors surveyed see tax insurance and or IR35 protection as vital or important speaks volumes. Tax insurance is no longer seen as a luxury, it’s fast becoming considered a necessity and a crucial component of the modern day contractor’s toolkit.
“Public liability insurance and professional indemnity insurance are often staple client requirements. Given the Government’s ongoing campaign to clampdown on what they consider to be widespread tax avoidance, the vast majority of contractors clearly feel that protecting themselves with tax and IR35 insurance is fundamentally important.
“With further tax changes predicted, it’s never been more essential for the UK’s 2million freelancers and contractors to safeguard themselves with insurance.”