Editor | 7 June 2011

Following the Office of Tax Simplification review of IR35 and the Government proposing to keep IR35 in the last Budget, HMRC have introduced a forum to review how administration is being improved.

Editor | 29 April 2011
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At PayMatters we are open to all options to address the Agency Workers Regulations (AWR) to ensure contractors working through our umbrella company have at least parity with permanent staff performing the same role at the same client.

In todays budget although IR35 didn't get scrapped there was one small bit of good news for contractors who currently get reimbursed for travel in their own car in carrying out assignments.

Instead of being able to be reimbursed tax free at 40p per mile this rate has now increased to 45p per mile (for the first 10,000 miles in the tax year).

This change comes into effect from 6th April 2011.

Editor | 23 March 2011
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The day has finally arrived and contractors will be eagerly waiting to see what the Chancellor, George Osborne, proposes to do with the much hated IR35.

Much hated because it is not always clear to contractors whether they will be caught by it or not and the effects of being caught could mean a large unexpected tax bill.

Editor | 10 March 2011
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The Office of Tax Simplification are set to report on their review of IR35 today 10th March 2010. The aim is to give the Chancellor 2 weeks to absorbe the recommendations prior to his budget.

In HM Treasury's own word the prupose of the Small Business Tax Review was (http://www.hm-treasury.gov.uk/ots_smallbusinessreview.htm:

Editor | 31 May 2011
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The Agency Workers Regulations (AWR) come into force on 1st October 2011 and these put added burden on the requirements of people employing agency workers. This affects the end client where the contractor is working, the recruitment agency who places the contractor and any umbrella company if the contractor is being employed through them.

The good news is that by working with PayMatters we can help take away some of this burden.

Following on from yesterdays budget the key changes for contractors working through Umbrella Companies or through their own Personal Service Companies (PSC) can be summarised as follows:

Editor | 23 March 2011
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In the Budget Report the following was said about IR35:

Following publication of the OTS (Office of Tax Simplification) review of small business tax, the Government commits to making clear improvements in the way IR35 is administered. The Government has decided to retain IR35 as abolition would put substantial revenue at risk.

How will The Bribery Act affect relations between Recruitment Agents and Umbrella Companies when the Umbrella Company is paying a recruitment consultant for referrals?

Editor | 10 March 2011
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The Office of Tax Simplification has released its initial report into what is often called "The Son of IR35".

http://www.hm-treasury.gov.uk/d/ots_small_business_interim_report.pdf

The findings seem to recommend to either scrap IR35 or keep it and police it better. Amendments and the possible merger of PAYE and NIC's are also cited as providing an opportunity to make the taxation of small businesses fairer.

In summary what they say about IR35 is:

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