With recent headlines, there is a need for Preferred Supplier Lists (PSL's) but at what cost?A contractor could demand that they continue to be paid through an umbrella that is not on an agencies PSL and that umbrella might not be compliant. The contractor may want to continue to use them as their take home pay is 85%+. In this instance, why should an agency want to use them?There is also additional administration in setting them up, if they have not worked with them previously. Due … [Read more...]
HMRC names avoidance scheme promoters for first time
All legitimate umbrella companies have been calling for the regulation of the sector for a long time.We are pleased to announce that Tax avoidance schemes have been named for the first time by HM Revenue and Customs (HMRC) as users are warned they could face large tax bills.HMRC has today advised anyone involved in Absolute Outsourcing’s or Purple Pay Limited’s Equity Participation Scheme to withdraw from them as soon as possible to prevent building up a large tax bill.This is the … [Read more...]
Changes to National Insurance
The big story in this Spring Statement was the announcement that the Government will increase both the Primary Threshold and Lower Profits Limit of National Insurance to bring them in line with the income tax personal allowance of £12,570.The Primary Threshold and Lower Profits Limit are the points at which both employees and the self-employed start paying National Insurance.Speculation had mounted in recent weeks that the Chancellor would cancel the proposed increase in National … [Read more...]
Trade body for Recruitment Professionals responds to the Spring Statement
Responding to the Chancellor, Rishi Sunak’s Spring Statement, Tania Bowers, Global Public Policy Director at the Association of Professional Staffing Companies (APSCo), comments:“The news that the National Insurance Contribution (NICs) threshold has been raised to ensure both the employed and self-employed can earn £12,570 without paying NICs from July is not what we expected or have called for. APSCo wrote to the Chancellor earlier this year calling for a delay to the NICs contribution … [Read more...]
Will the proposed increase to National Insurance, to cover the social care levy, have a drastic impact on the economy?
The plan is to increase National Insurance by 1.25% for employers and the same percentage for employees totaling an increase of 2.5%.With the cost of living rising since early 2021, December reached the highest recorded level in decades this is not a welcomed increase.Yesterday, The House of Commons called for the Government to replace the proposed National Insurance increase with taxes on the wealth of the richest. This motion has been signed by 21 members and no amendments have been … [Read more...]
HMRC’s approach to fraud in the Covid-19’s support schemes
As many of the governments coronavirus support schemes are coming to an end, HMRC are assessing the impact of fraud within them.HMRC’s current estimate for the amount lost to fraud and error in the schemes during 2020 to 2021 is a total of £5.8 billion against a £81.2 billion spend. 8.7% in CJRS, 2.5% in SEISS phases 1-3 and 8.5% in the eat out to help out schemes.From the beginning, it was clear the scheme would be targets for fraud and that customers may make mistakes.The … [Read more...]
Minimum Wage Boost
1st April 2022 will see national living wage rise to £9.50, which represents an increase of 0.59p.The increase will support the wages and living standard of low paid workers at a time when pay growth is robust across the economy.Bryan Sanderson, Low Pay Commission Chair, said:The rates we recommended will put money in the pockets of care-workers, food distributors and many other groups of the lowest-paid members of our society up and down the UK. Many of them have made a vital … [Read more...]
HMRC issue guidance on how to reduce your risk of using tax avoidance umbrella companies
Here at ePayMe, we have written a number of blogs on compliant umbrella firms, knowing your supply chain and tax avoidance schemes. Now, HMRC has published their own guidance on how to reduce this risk.As we’ve highlighted previously, off-payroll changes are bringing more workers under PAYE. However, some companies are finding unconventional and non-compliant ways to avoid this and pay less tax.These tax avoidance schemes operate on disguised remuneration, reporting some earning as … [Read more...]
Self-employed pension savings at a low
HMRC have released figures that reveal self-employed pension savings have hit record lows across 2019/2020. Since 2012 to 2013, non-eligible employee participation has increased to 34%. However, this has declined for the self-employed to 16%.In 2019/20 self-employed people paid around £830m into their personal pensions. Though, this figure is down from the £1.15bn paid in the previous year.It is thought that due to the COVID-19 pandemic, this figure would have reduced even further … [Read more...]
HMRC issues letters alerting contractors to tax avoidance schemes
The new IR35 Legislation has encouraged more contractors to seek work through umbrella companies. However, the rise of disguised remuneration schemes has now prompted HMRC to act.HMRC have started issuing Tax Avoidance Warning letters directly to contractors, strongly suggesting they may be involved in a DR arrangement or scheme. However, the contractors were likely deceived into signing up as a user, believing they were signing up to a true umbrella company.Are the Revenue using this as … [Read more...]