Compliant flexible PAYE solutions for contractors & freelancers
Specialist limited company accountancy for contractors
Giving workers in the construction industry greater flexibility
Bringing you exclusive discounts, the best deals and offers
Company Rescue, Recovery and Closure Advice for Business Owners
Industry leading solutions for agencies
Why wait? Call or email us now to find out how we can help
In a bid to rush their latest Finance Bill through the House of Commons before the snap general election this June, the government stripped out some key parts of its tax agenda, including the Making Tax Digital scheme.
The revised Finance Bill, which was passed through the Commons on Wednesday, was 80% shorter than the original document, but one thing that wasn’t cut from the revised bill was the controversial IR35 reforms for public sector contractors.
A team of thirty personal service company (PSC) contractors have agreed to abandon an already overrunning NHS IT project, after the Guy’s & St Thomas (GSTT) hospital trust said that the contractors would be declared ‘inside IR35’ from April.
From April, contractors working in the public sector will lose the right to determine their own IR35 status. As a consequence, thousands of PSC contractors could see their take home pay reduced.
In many cases it is feared that the legitimate contractors will be caught out by the reforms and unfairly end up on inside-IR35 contract and paying a heavy price for it.
There are, however, some ways that contractors can try to avoid IR35 and, if inevitable, mitigate the impact of an imposed inside-IR35 contract.
The new tax year is here and it has brought with it the usual soup of tax and regulatory changes. This year there are a number of important changes that will affect contractors, including new IR35 rules, changes to the flat rate VAT scheme and new income tax rates.
Some of the changes will be received positively – others, less so. Here we summarise the most important April changes for 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.
The government has published a new policy document detailing the changes to IR35 and off-payroll working rules for public sector contractors.
Although there weren’t any major shocks in the changes, which come into effect for personal service company (PSC) contractors next April, we thought it beneficial to publish a full preview of the rules so that customers can start to prepare for the changes.
