What does self-employed plumber ruling mean?

The Court of Appeal has ruled that a plumber, described by his employer as ‘self-employed’ should receive some of the same basic employment rights as a ‘worker’ for the company.

Brought against Pimlico Plumbers, London’s largest independent plumbing company, it is thought that the case will have implications for other companies that employ lots of self-employed workers.

A similar court battle was won by two Uber drivers last year in a landmark ruling for so-called ‘gig economy’ workers.

But some experts have warned that it is too early to make sweeping generalisations about self-employed contractors in other industries.

Editor | 6 February 2017
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HMRC have released a number of updated sections on their website detailing how the changes to IR35 and the public sector will work from April 2017.

Umbrella or PSC: What’s better for public sector contractors?

It’s a question that many limited company contractors will be asking in the coming months as impending changes threaten some of the biggest financial advantages that come along with limited company status.

For public sector contractors operating through personal service companies (PSCs) the changes could prove catastrophic.

The big shift concerns the IR35 status of public sector contractors – specifically, who judges a contractor’s IR35 status. From April, the responsibility for judging IR35 status will pass from the individual contractor to the hiring public sector body or agency charged with recruitment.

As a result, more contractors will be ‘caught out’ by the IR35 rules. Anyone ‘caught out’ by the changes will be reclassified by HMRC as being in ‘disguised employment.’ This means they will be taxed as if they were regular employees.

Do I have to submit a tax return?
Editor | 20 January 2017
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With little more than a week to go before the self-assessment tax deadline hits, it is worth double-checking whether or not you have to submit a tax return.

If you have to send a tax return and you miss the 31st January deadline then you will be penalised. If your tax return is less than three months late then you’ll have to pay a fine of £100, but this figure can rise quickly if you submit a return after three months or you pay your tax late.

For certain groups like company directors, it is pretty obvious that you will have to pay. But there are some complicated rules that you might not have taken into account.

If you are an umbrella contractor with Umbrella.co.uk, then as a rule of thumb you won’t have to submit a tax return, but there are some circumstances that may contradict that. 

The UK’s Christmas debt hangover
Editor | 13 January 2017
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Pre-Christmas debt figures suggest that more of us Brits are taking on unsustainable levels of debt which may mean tough times lie ahead for many.

The latest debt figures released by the Bank of England show that unsecured credit, including credit cards, car loans and second mortgages, grew by nearly 11% to £192.2bn in the year to November 2016.

Taking into account pre-Christmas shopping days like “Black Friday” and “Cyber Monday” November saw the sharpest month by month increase in debt for 11 years.

With debt levels now approaching “2008 financial crash” levels, debt charities and other organisations have issued warnings about debt.

FCSA blasts public sector IR35 changes
Editor | 10 February 2017
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A professional contractor employment services body has been scathing in its criticism of the changes to the off-payroll public sector changes, due to take effect in less than two months.

The Freelancer & Contractor Services Association (FCSA), which represents more than 110,000 contractors in the flexible workforce sector, said that the changes raise problems associated with accountancy, points of law and practicality. 

It is always scary pushing the submit button on your self-assessment. Even for veteran contractors, sending the final document can be unnerving because traditionally, HMRC doesn’t have much sympathy for mistakes.

FreeAgent on the Go
Editor | 20 January 2017
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FreeAgent continues to update its mobile app to bring the functionality more in line with the browser edition.

December brought some new features to the Mobile App, many of which may be of use to our clients;

The ever-popular Tax Timeline has been included within the App with the option to turn on notifications. This can help you to make sure you don’t miss any important VAT or Corporation Tax payments. Umbrella Accountants will continue to confirm how much is due and when but it acts as a good aide memoire in today’s busy work environment.

Off-Payroll Working in the Public sector – New Legislation 6th April 2017
Editor | 18 January 2017
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As you may already be aware the Autumn Statement delivered a number of measures which effect the contracting sector including changes to IR35 and the VAT Flat Rate Scheme. The government has published a new policy document detailing the changes to IR35 and off-payroll working rules for public sector workers. View document here.

The Changes

PSC or “Limited Company” Contractors operating in the public sector will no longer get a say on whether or not the IR35 ‘intermediaries’ legislation’ applies to them. Consequently if they chose to continue being paid via their limited company, the contractor’s intermediary (Agency / Public sector body) will have to agree to deduct the appropriate TAX and National insurance as the ‘fee payer’.

What info does the taxman’s super computer have on you?
Editor | 13 January 2017
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Ahead of the January 31 deadline for 2015/16 tax returns, HM Revenue and Customs has released some details about its £100m ‘snooper computer’ that can tell if you aren’t paying enough tax.

The powerful super-computer known as ‘Connect’ draws information from lots of different sources, including some places you might not have thought about.

If the computer thinks that you have underpaid on your return then it will flag your account and prompt further investigation.

All this means that HMRC no longer needs to rely solely on information supplied by individual taxpayers. If you, accidently or otherwise, misreport your income then it could only be a matter of time before you get caught in the taxman’s web.

HMRC is already using the system to warn users that that they may have underpaid on previous tax returns.

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