Overview Off-payroll working rules change on 6 April 2020 and are applied differently. From this date, all public authorities and medium and large sized clients will be responsible for deciding the employment status of workers. Who the rules apply to Some rules already apply to all public sector clients, but from 6 April 2020 medium and large-sized private sector clients also need to apply them. The private sector includes third sector organisations, such as some charities.The rules apply … [Read more...]
Thousands of workers are suffering incorrect Tax thanks to IR35
Thousands of employees working within the public sector are potentially being taxed incorrectly in an ongoing fiasco surrounding their IR35.IR35 has always been a tricky piece of regulation, and it seems like it's not getting any easier to manage with time. Serious questions over the accuracy of the Check Employment Status for Tax (CEST) tool are only being underlined by courtroom defeats for HMRC over status challenges. Meanwhile, confusion over the rules has contributed to an 8% … [Read more...]
Just when I thought I was OUT, they pull me back in
With ongoing research by many commentators showing that contractor’s confidence in HMRC’s IR35 CEST (Check Employment Status Test) tool is low, questions are now turning to whether the tool is now even fit for purpose. This is especially prevalent with the governments supposed determination to implement these changes to the private sector.The CEST tool is used by contractors’ and Public Sector Authorities to accurately assess and determine an engagement’s IR35 status. Provided the … [Read more...]
Your Provider May Giveth but HMRC May Taketh Away!
Only last week we heard that several recruitment consultants had received tax demands from HMRC relating to unpaid tax on incentive payments received from one or more umbrella companies. If recruitment agency staff accept monies, vouchers and other types of benefit from umbrella providers, they should be declaring this as taxable income.The Government is taking this issue seriously and the actions being taken within the next two years will highlight not just taxation but also the UK’s … [Read more...]
PSCs, are you ready for £3,000 less in dividend allowance?
It might date back to an announcement almost three years ago, but a change to dividend taxation will hit PSC contractors – in earnest – from next month, writes James Trowell, head of tax at Dolan Accountancy. In fact, from 6th April 2018, there are significant changes to the tax-free dividends allowance. These changes will reduce the 2017/18 tax-free rate from £5,000 to £2,000 -- per tax year, in 2018/19.The ChangesTax Free Dividends Allowance - £2,000 Personal Allowance - £11,850 (up … [Read more...]
Tax-Free Childcare: All you need to know about the new scheme
Thousands more families can now claim tax-free childcare - after the Government extended its Tax-Free Childcare scheme to children under nine.Here’s what you need to know.Why is this being introduced now?The government introduced Tax-Free Childcare in April 2017. This latest announcement is part of a continuing roll-out.So what’s changing?Some families currently get childcare vouchers through their employers to help towards costs, but from April 2018 this scheme will close to … [Read more...]
How your imminent self-assessment is affected by your set-up
If you're a contractor and you haven't yet submitted your self-assessment to HMRC, then you need to get going - the deadline is midnight on January 30th. With all the recent changes to the rules, there are sure to be many people scratching their heads as they struggle with their returns. You can find some useful information videos on YouTube, and the following article provides some extremely valuable advice.With the starting pistol of 2018 now well and truly fired, countless contractors … [Read more...]
Newly self-employed? Don’t miss the October 5 deadline!
If you became self-employed in the 2016-7 tax year (ie between 6 April 2016 and 5 April 2017), and you haven’t yet registered as such with HMRC, then you need to do so by this coming Thursday - October 5th or face the risk of penalties. By law you are required to register so HMRC know they have to issue you with notice to complete a self-assessment tax return and send you tax statements when required.You may also need to register separately for VAT if your VAT taxable turnover is more than … [Read more...]
Are you and your business ready for the Criminal Finances Act 2017?
With so much red tape and other recent changes to IR35 passing your desk, you can be forgiven for taking little notice of this legislation passed by Parliament last April. An introduction date of 30th September means that action may need to be taken to ensure you remain compliant.The Government believes that relevant bodies should be criminally liable where they fail to prevent those who act for, or on their behalf from criminally facilitating tax evasion.Here is a link to the draft … [Read more...]
Why private sector IR35 reform isn’t inevitable
Two pointers in an otherwise largely acceptable viewpoint piece on ContractorUK last week stuck in my craw, writes ex-tax inspector Carolyn Walsh, managing director of Andraste Accounting and CWC Solutions.And this happened not because my money’s on the public sector’s off-payroll rules not being extended to the private sector, which the piece bets that it will be.The first of the two pointers is rhetorical: “Given that HMRC most likely consider public sector reform a success so far, why … [Read more...]