Contractors Articles

Finance Bill Confirms Private Sector IR35 Details
marketing | 15 July 2019
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The Treasury has published the Finance Bill 2019-20 , which confirms a number of important details about the upcoming IR35 reforms in the private sector.

 

Ignoring some of the recent calls for the reforms to be delayed, the bill confirms that off-payroll rules will be extended to the private sector from 6 April 2020.

 

In line with the changes in the public sector, private sector clients will be responsible for assessing a contractor’s IR35 status. Previously, this responsibility lay with the contractor.

 

HMRC Pressed For IR35 CEST Tool Release Date
marketing | 3 July 2019
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HMRC is under pressure to say when the new improved IR35 ‘Check Employment Status for Tax’ (CEST) tool will be released, as stakeholders point out flaws with the current version.

 

The tax authority has confirmed that its CEST tool will undergo enhancements before IR35 reforms are extended to the private sector from April 2020.

 

But so far, little is known about what updates will be applied and when the new tool will be available.

 

Treasury Collects £1bn from Contractor Loan Charge
marketing | 23 May 2019
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The Financial Secretary to the Treasury this week confirmed that HMRC has collected £1bn from the loan charge, with most of the money coming from contractor employers.

Answering questions in parliament, Mel Stride said that 85% of the £1bn so far collected came from employers. He added that the average salary of the employees impacted was double the national average.

Taking effect this tax year, the loan charge is levied on contractors involved with one type of disguised remuneration scheme.

 

HMRC Wins Case Over Contractor Loan Scheme
marketing | 4 April 2019
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HMRC has won a tribunal case against a contractor loan scheme promoted by Hyrax Resourcing Ltd.

Hyrax Resourcing will now be forced to disclose the details of 1,180 ‘high earners’ that use the scheme and help the tax authority claim back more than £40 million in unpaid taxes.

The scheme in question was a disguised remuneration tax avoidance scheme that paid users in loans so that they could avoid paying income tax and National Insurance contributions on their earnings.

 

Umbrella.co.uk staff support Food Friend Wilmslow
marketing | 27 March 2019
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The staff at Umbrella.co.uk have collected and delivered much needed items to our local food bank, Food Friend, based at St Bartholomews in Wilmslow.

Food Friend is run and organised by St Bartholomew's Church and provides short term assistance and support to individuals and families in Wilmslow. Illness, disability, family breakdown or the loss of a job could happen to any of us.

 

NHS Locum Contractor Wins Partial IR35 Tax Case
marketing | 11 July 2019
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An IR35 ruling on a case involving a urologist who worked for two different hospitals could have important consequences for medics operating as locums and NHS off-payroll working rules more generally.

In the tax tribunal case between a locum urologist and HMRC, a judge ruled that one of the contractor’s hospital contracts was inside IR35, while off-payroll working rules did not apply in the other.

Contractors Stung by Dividend Allowance Cut

After wrapping up their tax affairs for the 2018/19 tax year, many limited company contractors will only now be waking up to the reality of the 2018 dividend allowance cut, which saw the tax-free dividend allowance drop from £5,000 to £2,000.

In 2018/19, this tax-free allowance was applied to the first £2,000 of dividend income. Above £2,000, dividends are taxed at a flat rate according to the tax band they fall into.

Majority of Public Sector Contractors Ruled Inside IR35
marketing | 20 May 2019
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Ahead of reforms to private sector IR35 rules, new research shows that several public sector organisations are, in the majority of cases, judging contractors to be inside IR35.

Since 2017, public bodies have been responsible for deciding whether a contractor is truly self-employed or whether they should be taxed as if they were an employee of the firm.

The rules apply to limited company contractors who, before the rule change, were responsible for judging their own IR35 status.

From April 2020, the same reforms will be introduced in the private sector, so that organisations with 50 or more employees will be responsible for judging a contractor’s IR35 status.

Treasury: 2019 Loan Charge Will Go Ahead Despite Appeals
marketing | 4 April 2019
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The Treasury has confirmed that the 2019 Loan Charge will take effect this week, despite appeals from MPs, members of the House of Lords and Loan Charge campaigners.

HMRC released a last-minute statement on Wednesday, reminding Loan Scheme users that they have an obligation to pay the tax owed.

The statement urged users of disguised remuneration schemes to come forward and settle their debts by April 5. The tax authority also said that ‘flexible’ payment options are available to those that worry they will not be able to pay.

 

Fewer Contractors Saving for Retirement

New research suggests that the pensions system is broken for independent workers, with a 12% increase in the number of contractors that aren’t saving for retirement.

The survey of 1,000 contractors shows that almost two-thirds of people that work for themselves avoid paying any money into a personal pension scheme.

That equates to almost three million contractors that may not have enough money when they finally give up work.

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