Although a controversial tax law, the report found that it has actually brought some benefits to UK contractors.  For the first time, contractors joined forces to fight against the effects of IR35 on their livelihoods.

Despite IR35, Dave Chaplin of Contractor Calculator believes the contracting sector has matured and strengthened. “Not only that,” says Chaplin, “but as the core component of UK PLC’s flexible workforce, contractors have the potential to lift the economy out of recession. The UK is lagging behind its global economic peers by remaining in recession,” explains Chaplin, “and it is the massive burden of business taxes and regulation, like IR35, that is now holding back the UK’s economic growth.”

The report also highlights that the risks of IR35 to a contractors financial health is now better understood than it was 10 years ago and a specialist service sector has risen to the challenge of supporting contractors.

ICS recommend you take time out to read this report as it is a worthwhile read for all UK contractors.

Click here to download Contractor Calculators IR35 Report – 10 years that shook the world of UK contractors.

BBC Radio 5Live was told people are brought to the UK to work on government IT projects run by BT and Capgemini. Both firms say they are operating within the law. Intra-company transfer visas (ICT) mean an overseas employee can come to work for their company in the UK if they have six months’ experience, are paid an appropriate salary and do not take the job of a permanent UK worker. The government said it was tightening the rules on such visas. About 50,000 ICT visas are issued every year and two thirds of them go to employees in IT and telecommunications. About 70% are given to Indian nationals.

British IT worker Anil Verma has been out of work for two years and said;

“A lot of the IT contractors – they’re very very bitter about it. The government’s issued too many intra-company transfer visas and a lot of these guys have come over from India and flooded the IT industry. There are not enough jobs to go round.”

A contractor whose contract was not renewed by Capgemini believed talented Britons were gradually being replaced by Indian workers brought over on ICTs and he, like other IT contractors, feels that they are being undercut by cheaper overseas labour.

The UK Border Agency said there were strict rules on what ICT visa workers should be paid and any allegations of abuse would be investigated. The rules regarding ICTs will be tightened next year but it is not enough according to the Professional Contractors Group (PCG) and Association of Professional Staffing Companies (APSCo) who both believe the rules need to be tightened much more.