HMRC has accused approximately 1,500 contractors who are currently or previously engaged by UK pharma giant GlaxoSmithKline of IR35 non-compliance for the 2018/2019 tax year.

The contractors received letters from the HMRC stating that they were operating outside of IR35 during the tax year. IR35 legislation is designed to tax “disguised employment” 

The contractors were also told they have until 19 September 2019 to either agree with HMRC’s assessment and make a deemed payment for their work or disagree but give reasons.

In the letter, HMRC states: “It is our view that the contract between your PSC and GlaxoSmithKline (GSK) comes under the off-payroll working rules ‘IR35.’”

Seb Maley, CEO of IR35 specialist, commented, “In these letters, HMRC takes the view that contractors are guilty until proven innocent. This is yet another example of the taxman’s aggressive and unfair treatment of independent workers. At this stage, none of these contractors’ actual working practices have been reviewed. Without doing so, it’s impossible for HMRC to say with confidence that contractors are in the wrong.”

This year has seen a number of high profile IR35 cases, including most recently with radio presenters and broadcasters.

In July 2019, the government announced that it would be extending IR35 off-payroll working rules to the private sector from 6 April 2020. 

Last week the government HMRC published guidelines on IR35, and what it means for intermediary companies. HMRC’s guidelines aim to help intermediaries understand and prepare for IR35.