Rachel Reeves overlooks contractors in ‘thin’ Spring Statement 2026

Rachel Reeves overlooked contractors at Spring Forecast 2026, talking instead of 'restored economic stability' and asserting 'my plan is the right plan.'

The chancellor's bullish comments allude to the new US-Iran war in the Middle East, which she promised to protect the finances of UK "working families" from.

What did Rachel Reeves just call the mini-Budget that vowed to axe IR35 reform?

Defiant rather than downbeat, Ms Reeves took two swipes at the "disastrous" mini-Budget, which contractors cheered in 2022 for its vow to axe the IR35 Off-Payroll Working rules.

The chancellor also said she'd be supporting AI and entrepreneurs, but, in doing so, differentiated those 'in business on their own account' from workers.

What did the chancellor say about AI and entrepreneurs?

Reeves said the UK would 'harness the power of AI' to ensure AI entrepreneurs can "thrive" in Britain, so "working people reap the rewards."

In a statement sent to ContractorUK after the chancellor sat down, the Recruitment & Employment Confederation (REC) said that, unfortunately, it is seeing the opposite.

"Businesses are still on the brakes and leaving our growth underpowered, while international businesses find the UK less attractive than they did once".

Is having only one fiscal event a year being welcomed?

Neil Carberry, REC's CEO, was more positive about the chancellor's decision (in 2024) to hold only one fiscal event a year.

The move "gives business the certainty they need," Reeves claimed to MPs in the House of Commons earlier today.

The REC's Mr Carberry endorsed: "Having just one fiscal event each year gives employers much-needed stability.

"[It allows] them to get on with running their businesses without the distraction of constant tax and spending speculation."

The trade-off of having only one fiscal event is that supporters of contractors hoping for a boost from a policy tweak, or a change of tack on tax, get nothing.

What and who doesn't Spring Forecast 2026 address?

Robert Salter, a director at Blick Rothenberg, said: "The government [at Spring Forecast 2026] has not specifically addressed some of the wider issues that significant groups of taxpayers are facing at the present time.

"[The chancellor] made no mention about the impact of 'high skilled individuals' having increasingly looked to leave the UK over the past five-plus years.

"Whilst some of this movement has been incurring already — because of the increasing ease of working globally in the modern world — the reality is that some of Ms Reeves's policy changes including the removal of the non-dom system of taxation, which can actually make it very beneficial for wealthier British nationals to leave the UK on a long-term basis to avoid inheritance tax have probably helped increase the numbers leaving the UK."

Will contractors be fooled by Spring Statement 2026?

Anthony Mellor, a tax adviser, agrees that Spring Forecast 2026 was arguably a missed opportunity to free UK contracting from the rut it has been in.

"A spring in Rachel Reeves' step as she left Downing Street won't fool anyone, including contractors," Mr Mellor, a chartered accountant, began in a statement to ContractorUK.

"Indeed, recent precedent suggests contractors should not expect dramatic change from the restrictive legislative pattern they've been in for a while.

"And looking at 2024 and 2025, that pattern has been clear. It's one of limited direct benefits for limited company contractors, also known as Personal Service Company workers.

"It's also one of modest gains for PAYE/umbrella staff via NI changes, but a stronger HMRC compliance tone, in earnest from 2026-27 with Joint and Several Liability (JSL) rules."

Did Spring Forecast 2026 mention IR35?

Mellor & Co's boss added that since Labour came to power in July 2024, "IR35 has remained untouched," and Reeves today "continued that trajectory."

Therefore, under Spring Forecast 2026, the key framework governing contracting is unchanged, largely in line with an FCSA appeal on ContractorUK on the eve of the statement.

The forecast also fails to announce an employment status review, which the Freelancer & Contractor Services Association (FCSA) has observed was promised by the end of 2025.

Does Spring Statement 2026 give contractors new rules to contend with?

Matt Fryer, managing director of Brookson, confirmed after the chancellor had finished speaking that some contractors might be glad to see the status quo intact.

"There are no announcements in Spring Forecast 2026 regarding changes to what we already know from a contractor tax and policy perspective," Mr Fryer told ContractorUK.

"So, no new news for contractors to have to consider.

"Or, perhaps more pertinently, given the last few years, nothing new for contractors to contend with."

Why did Rachel Reeves warn, 'there is more to do?'

However, the boss of Brookson also pointed out that, as well as JSL and other reforms affecting UK contracting, the chancellor warned, "There is more to do."

Mr Fryer said: "With the UK growth forecast downgraded from 1.4% to 1%, and unemployment predicted to rise further in 2026, it's clear why Reeves cued up more action.

"Should these trends continue into the summer, potentially alongside the Middle East conflict, the 2026 Autumn Budget is going to be very interesting indeed."

'Contractors look set to suffer cautious client spending and delayed projects'

SG Accounting shared with ContractorUK a more positive interpretation of the Office for Budget Responsibility's figures, even if contractor budgets and projects look unlikely to benefit.

The contractor accountancy firm says: "The updated OBR forecasts point to steady but modest growth over the coming years, easing inflation and a gradual improvement in the public finances, which should provide a degree of economic stability.

"However, with growth projections slightly downgraded and ongoing global uncertainty — particularly around energy costs — many contractors may continue to experience cautious client spending and delayed projects in the short term."

Does Spring Forecast 2026 signal business-as-usual for contractors?

Dan Mepham, SG's managing director, also told ContractorUK that because Spring Statement 2026 'largely stays the course,' it's 'business-as-usual' for many contractors.

"With no new headline tax measures affecting contractors or small business owners… the key focus [for limited company directors] remains on preparing for previously announced Budget 2025 changes".

When is HMRC's free online service for filing company accounts closing?

Asked by ContractorUK for an example of a previous announcement contractors can now prepare for, thanks to the lean spring statement, Meredith McCammond, a tax expert, pointed to March 31st 2026.

"The closure of HMRC's free online service for filing company accounts and corporation tax returns at the end of this month is pretty significant," McCammond, technical tax officer at the Low Incomes Tax Reform Group (LITRG), said.

"The rationale from the government, options going forward, and what actions need to be taken before closure is something I'd recommend contractors familiarise themselves with by reading this HMRC guidance."

'Make Work Pay consultation shows government is misinformed'

A lawyer at Osborne Clarke prefers that it's the government which should do some swatting up.

"It's great that these long-standing problems are finally being addressed [by the government in Make Work Pay: Modernising the Agency Regulatory Framework]," began the Osborne Clarke lawyer, Shaziya Kurmani.

"[But] the specific consultation questions and the preambles suggest that policymakers are misinformed about how UK labour supply chains currently operate.

"The Make Work Pay consultation also fails to deal with a wide range of important issues that require government attention, including how this regime will interact with the proposed 2027 guaranteed hours rights regime in the Employment Rights Act 2025."

Are contractors being asked to change umbrella company due to JSL?

Brookson's Matt Fryer says the umbrella market was the focus before the chancellor got to her feet, and still is.

"What we do know is that the contractor umbrella market is going through a major rehaul, given the introduction of new rules in just five weeks.

"And those rules bring HMRC tax risk to supply chains. This is resulting in many contractors being asked to change umbrella company, as recruiters tighten up on their preferred supplier lists to try to better manage their risk."

'Thin Spring Statement is ideal time to review 2026/27 remuneration'

A qualified chartered accountant, Mr Fryer said contractors unaffected by the umbrella market's reforms should use this time to review their dividend/salary figures ahead of April 6th.

"As tax and NI rates and allowances are now locked in for next year, a thin Spring Statement is a good time for directors of limited companies to consider their remuneration strategy for the 26/27 tax year," he advised.

What was the key takeaway for contractors of the 2026 Spring Statement speech?

Carolyn Walsh, a former tax inspector, believes that while the chancellor's full report fails to contain much of interest to contractors, her speech was telling.

"For contractors and small business owners, a key takeaway is the Reeves line, 'Stability is the single most important precondition for economic growth.'

"That refers to the government limiting major policy changes to once a year in the Budget.

"And with the personal tax-free allowance frozen until the 2030s, dividend tax increasing from April 6th 2026, and IR35 still squeezing the life out of contracting, limited company directors need to consider how to distribute their income over the next few years," she says.

Are contractors better off under the Spring Statement 2026?

Boss at Oblako Ltd, which advises contractors on PAYE and HMRC disputes, Walsh continued: "But there's another line from the chancellor's House of Commons speech this afternoon that contractors should keep in mind.

"Reeves said, 'I know that the question people will ask themselves at the next election is this: Are my family and I better off?' Well, from the contractor community, the answer is going to be an emphatic 'no.'"