When IR35 was first introduced there were a significant number of people working through limited companies for the tax advantages who did enjoy much the same benefits as permanent employees. They had long notice periods to end contracts, they got to use staff facilities, etc. They were basically employees in all but name and that's why they were seen as dodging tax and IR35 was introduced.
The problem with IR35 has never been the principle that disguised employees should not escape the normal employee tax rules. It's always been that there were also significant numbers of other people affected who really were working more independently and acting like any other real business, which just happened to be owner-operated in their case. Even if they're doing nothing wrong all of these people now have this IR35-shaped sword hanging over every contract they take and so do their clients.
If nothing else it creates extra admin and more legal and insurance costs for those involved. I've known promising contracts to get sunk at the last minute because one side or the other was concerned about some of the details looking a bit too close to being caught by IR35 and because naturally these tend to be relatively short jobs it's not always worth engaging serious lawyers to resolve things. Basically it means everyone loses and all because the tax rules were ambiguous and created more risk than the contract was worth to either or both parties.
My experience contracting very many years ago (and before IR35) was that you were ultimately just a hired hand, compared to permanent employees, even if you were expected to turn up every day just like an employee, and your contract (which was usually only 3, 6 months) etc, would roll over and over as though you were permanent.
Sick days, no pay. Holidays, no pay. Economic downturn? You will be the first out the door. Contract not renewed? Tough, don't expect any 'severence'. Company makes a huge profit? No bonus for you. Forget billing for company parties/outings, etc. Training? lololol, up to you. Plus, you pay your own pension, social security taxes, etc.
The problem with IR35 has never been the principle that disguised employees should not escape the normal employee tax rules. It's always been that there were also significant numbers of other people affected who really were working more independently and acting like any other real business, which just happened to be owner-operated in their case. Even if they're doing nothing wrong all of these people now have this IR35-shaped sword hanging over every contract they take and so do their clients.
If nothing else it creates extra admin and more legal and insurance costs for those involved. I've known promising contracts to get sunk at the last minute because one side or the other was concerned about some of the details looking a bit too close to being caught by IR35 and because naturally these tend to be relatively short jobs it's not always worth engaging serious lawyers to resolve things. Basically it means everyone loses and all because the tax rules were ambiguous and created more risk than the contract was worth to either or both parties.