UK Freelancers Leaving The Country Over IR35

by Robin Pilgrim, LawAndTax-News.com, London

20 August 2003

A poll recently conducted by UK freelance industry group, Shout99 has revealed that, as predicted when the measure was introduced, many of the UK's freelancers are electing to work abroad in order to avoid being caught by the country's controversial IR35 tax legislation.

According to the results of the survey, 4% of respondents have decamped to the United States, 3% have gone to the Netherlands, and 4% have relocated to Germany. Ireland and Switzerland have both attracted 1% of the freelance workers polled.

Of the remainder, 43% revealed that they were happy to stay in the United Kingdom, but an alarming 33% announced that they too were thinking of leaving for more tax-friendly climes.

Speaking to the UK media with regard to the results of the survey, Shout 99's Susie Hughes explained that:

'Three years on, IR35 is an established reality and clarification of best operating practice is now helping freelancers move outside the confines of the legislation.' However, she added that:

'The uncertainty of operating as a freelance business continues to cause problems for many businessmen and women as they have to contend with a depressed market place, increasing red tape, lower rates, and new measures which bring added uncertainty such as outsourcing, fast track visas and Section 660 - the business tax on family and friends.'

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