Budget 2026: Contractor advisers ask for ‘IR35 reset’

Budget 2026 will be delivered by chancellor John Healey on October 28th, in a fiscal statement he’s warned contractors — and Westminster — will ‘move money and power.’

The UK contractor sector wants IR35 to top the list of Mr Healey’s reforms.

In other words, the consensus of UK contracting experts who spoke to ContractorUK since the chancellor set the Budget’s date on July 31st 2026 is that they want “an IR35 reset” — as one put it.

At a glance

• SG Accounting, Re Legal Consulting and Caroola Accountancy all point to the same problem for Budget 2026 to fix: a risk-averse ‘Inside IR35’ default that’s shutting out independent contractors.
• The FCSA says no changes to the off-payroll working (OPW) rules are coming, even though IR35 contract review firm Qdos also backs a “reset” for the self-employed.
• DNS Accountants wants the employer NIC threshold reversed to £9,100 and the main rate reverted to 13.8%, while IPSE wants a period of stability as one of five enterprise-friendly measures.
• John Whelan of Camino Alta is urging chancellor John Healey to review MSC legislation cases where HMRC is ‘cruelly’ transferring debt to individual contractors.
• Philip Ross of Community and Labour Business hopes Burnham’s words from 2015 — that the self-employed “will no longer be an afterthought” — translate into policy actions on October 28th 2026.
• Contractors can have their say to HMT, including objecting to the Intermediaries legislation (IR35), via the Budget 2026 policy portal, open until September 9th 2026.

What contractor accountants want: an IR35 reset

Caroola Accountancy says its “wish” for Budget 2026 is for HM Treasury or HMRC to offer “greater certainty around IR35, and clearer guidance for hiring organisations.”

Re Legal Consulting says that, while the issue it hopes Mr Healey tackles is technically “much wider,” it wants the chancellor to “sort out” the status of “Inside IR35” being engagers’ “default” decision.

And SG Accounting (which made the “reset” remark) hopes the new chancellor resists Off-Payroll Working (OPW) rules tinkering, in favour of announcing a “clearer framework.”

Why IR35 keeps coming back as the top ask

The three contracting experts are veterans. Caroola’s underlying roots date back to 1992 (with the formation of SJD Accountancy); Re Legal dates back to 1999, and SG was formed in 1995.

So the three know that by calling for action on IR35, which was introduced in 2000, reformed in 2017, and reformed in 2021, they appear to be hoping against hope.

That hope was largely dismissed by the Freelancer & Contractor Services Association (FCSA) in a social media post on Tuesday August 18th 2026.

FCSA: no IR35 change is coming

“HM Treasury wrote to public sector Accounting Officers in June 2026 to restate that off-payroll working [enforcement] remains a compliance priority.

“The government has [separately] ruled out a review of the OPW legislation and set aside Single Worker Status proposals.

“So the [IR35] rules that apply now are the rules for the foreseeable future,” posted FCSA, which then doubled down: “There is no pending change to wait for.”

The FCSA is correct: HMT wrote to government accounting officers on June 19th, and Treasury minister Dan Tomlinson ruled out an IR35 review on June 30th.

However, the Treasury’s letter to the public sector, where some £400million in IR35 mistakes have now been made, was written under the previous Labour government.

Also due to Andy Burnham replacing Keir Starmer as both Labour leader and prime minister, Mr Tomlinson has now been moved on and is no longer at the Treasury.

Qdos: Burnham should ‘reset’ self-employment policy

Nicole Slowey, a director at Qdos, says: “Andy Burnham has the opportunity to press ‘reset’ on how the government treats the self-employed population.

“It’s clear that a change of approach is needed. You can’t keep targeting the self-employed with tax hikes and policy that just doesn’t reflect the modern way of working, yet talk about how supportive you are of those who choose to work for themselves.”

Speaking before Healey set the date for Budget 2026, Ms Slowey said the Burnham-led Labour government should “overhaul” HMRC’s IR35 tool, Check Employment Status for Tax (CEST).

She also said HMRC should “do more to educate businesses” about the OPW rules, partly because “we’re five years into private sector reform, but the same problems exist.”

It appears, then, that just as IR35’s problems persist, so too do advisers’ calls to fix them.

SG Accounting and Caroola Accountancy on what an IR35 reset means

“My wish for Autumn Budget 2026 would be a genuine reset of IR35 rather than another minor adjustment to an already complex regime,” SG Accounting’s boss Dan Mepham told ContractorUK.

“The off-payroll working reforms shifted risk onto businesses, but one unintended consequence has been widespread risk-aversion, with some engagers defaulting to blanket Inside IR35 decisions.

“A clearer framework that gives businesses confidence to engage genuinely independent contractors would benefit everyone.”

Carl Bridges, operations director at Caroola Accountancy, told ContractorUK: “My wish for Budget 2026 would be greater certainty around IR35 and clearer guidance for hiring organisations.

“Since the off-payroll working reforms were introduced, we’ve seen many end-clients take a risk-averse approach, resulting in broad Inside IR35 determinations or blanket policies that limit opportunities for genuine independent contractors.

“Most businesses want to comply with the IR35 rules, but many still struggle with the complexity and potential financial consequences of getting a determination wrong. I’d like to see clearer, practical guidance from HMRC that gives end-clients the confidence to assess contractor engagements fairly and on their own merits.”

Re Legal Consulting: Tackle ‘Inside IR35’ by default

Asked by ContractorUK what the chancellor should do on October 28th 2026, Re Legal Consulting founder Rebecca Seeley Harris, who the Treasury has previously asked to advise on IR35 simplification, replied:

“I’d like…[Mr Healey] to sort out the position where individual contractors are having PAYE deducted but still being treated as ‘self-employed.’ 

“It is so much wider than just an Inside IR35 position,” said Seeley Harris, potentially alluding to the Elective Deduction Model — “but it’s something that is becoming the market default.”

What Healey has said about Budget 2026

In a ‘down the lens’ video on July 31st, chancellor Healey said October 28th 2026 will see “a Budget that moves money and power out of Westminster, and into every postcode around Britain.”

Healey said the Andy Burnham-led Labour government had already “begun to kickstart growth in every postcode” — a nod to Mr Burnham’s bus cap fare freeze and an energy bill VAT cut.

John Endcott, head of wealth at PKF Francis Clark, reflected at the time — in an online update that seems to cue up the ‘giveth with one hand, taketh with the other’ approach that chancellors are notorious for.

“Burnham’s first tax policy is to cut VAT on fuel…[costing] £850m a year of revenue,” Endcott began.

“I say ‘Burnham’ because I suspect Healey had to accept it if he wanted the job.

“The VAT cut will narrow the tax base, which is a bad thing. It will help reduce inflation for the September 2027 uprating of benefits, which is a good thing.”

Budget 2026 reaction: what to expect on October 29th

Elsewhere online, tax expert Giles Mooney says he’s preparing an October 29th webinar to unpack Budget 2026’s key measures — his ninth such session, each one relating to a different chancellor.

“I can honestly say I was more confident I knew what was coming with every other chancellor of the exchequer,” wrote Mooney, referring to the uncertainty of what Healey will tell the House of Commons on 28.10.2026.

“With the amount he’s planning to spend [as chancellor], I suspect there’ll be lots to talk about.”

In his July 31st Budget date announcement video, the chancellor reassured that Budget 2026 “will meet our fiscal rules.”

Healey, who was a trade union campaigns director before entering politics, also said his budget would “give businesses and families some of the stability they need to plan for the future.”

If Budget 2026 does offer stability to enterprise, contractor trade body IPSE could tick off one of five asks it has made of Andy Burnham’s first 100 days since he became PM on July 20th 2026. 

DNS Accountants: employer NIC threshold should reverse to £9,100

But just ‘business as usual’ won’t cut it according to DNS Accountants, which has identified “three areas where UK SMEs urgently need action.”

DNS’s founder Sumit Agarwal says relief on employer national insurance is the key — specifically, by “reversing” the threshold to £9,100 and the main rate to 13.8%. He also wants action on corporation tax and NEETs.

MSC legislation: Use Budget 2026 to probe ‘HMRC cruelty’

John Whelan, principal at Camino Alta, will probably be hoping for a reversal in Mr Healey’s reported attitude.

In a LinkedIn post, Whelan claims he had a 30-minute Whitehall meeting with Mr Healey in November 2006, to discuss the Managed Service Company (MSC) legislation — only for the then-Financial Secretary to the Treasury to spend 20 minutes talking to someone else in the room about the World Cup.

Turning to Mr Healey’s upcoming fiscal statement, Whelan shared: “I sincerely hope that he will take a look at the recent Churchill Knight and Boox MSC ‘prosecutions’ — in which HMRC is cruelly seeking to transfer debts to individuals.

“Healey’s appointment as chancellor has sent a shiver down my spine. I expect he has forgotten our brief interaction, but I certainly haven’t.

“Hopefully, [Healey] will turn his mind to the above [MSC] cases, and explain to HMRC that personal debt transfer to ordinary people was not the intention of parliament when the MSC legislation was passed [into law] in March 2007.”

Will Andy Burnham live up to his own words on self-employment?

As well as the hopes by contractors’ advisers for Autumn Budget 2026 to intervene on MSC cases, IR35 and employer NIC changes, there’s a more plain hope — that Burnham will merely live up to what he’s said.

Indicating that he wants to see the Makerfield MP’s words translate into actions, Philip Ross, co-chair of Community, and vice chair of Labour Business, posted:

“[Here is] what Andy Burnham said in 2015 [about] self-employment: ‘The tendency of government to ignore the self-employed goes deeper… [and] even well-meaning policies end up causing them harm.

‘Before the election, Labour rightly highlighted the plight of those pushed into self-employment due to a lack of secure work. But we didn’t acknowledge that most self-employed people have higher job satisfaction and that they are a key ingredient of a successful economy of the future. So I want to correct that mistake.

‘Labour has always been the workers’ party, and in the 21st Century that means Labour must be the party of the self-employed too. So under my leadership these vital members of the workforce will no longer be an afterthought — every policy will be considered for its impact on them ’.”

Autumn Budget 2026 build-up: IR35 still dominates

Yet in a sign of the strength of the sheer feeling on IR35, an ‘Open To Work’ contractor (Ken Lamparter) responded to Ross, about Burnham:

“Well, he can start with reversing IR35…but I will not hold my breath.”

And comments under Whelan’s LinkedIn post about John Healey and MSC cases also turned to IR35.

“Any chance…[he] can get rid of IR35?” a user asked of the chancellor. “It’s killing our industry.”

Speaking to ContractorUK, Caroola Accountancy’s Carl Bridges said an unintended consequence of IR35 is that organisations now operate in fear of HMRC challenge.

He explained: “Where a contract genuinely falls Outside IR35, businesses should feel able to engage contractors on that basis without fear of disproportionate challenge from HMRC.

“Greater certainty would benefit contractors, end-clients and the wider economy by creating a more flexible labour market and allowing businesses to access specialist skills when they need them most.”

How contractors can have their say before Budget 2026

SG Accounting managing director, Dan Mepham, signalled he’ll use the Budget 2026 policy representation portal — open to contractors and others until September 9th 2026 — to object to the Intermediaries legislation.

He told ContractorUK: “[An IR35 reset] would reduce uncertainty, improve labour market flexibility and help organisations access specialist skills quickly. At a time when growth is so high on the government’s agenda, creating a more effective contracting environment would be a sensible place to start.”