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Yesterday we highlighted the key changes to the amounts of personal taxation and national insurance contractors will pay due to changes that come into force for the new tax year (started 6th April 2015).
One of the changes that dictates how much many contractors will pay themselves as wages when working through their own Personal Service Company (PSC) is that employees national insurance now starts at a lower amount than employers national insurance (but up from the £153 in the prior tax year).
Why Introduced:
So HMRC can tackle Employment Intermediaries that use false self-employment and offshore locations to reduce taxes and avoid employment rights.
HMRC want to know amounts paid to workers supplied by the Employment Intermediary where PAYE has not been deducted.
The Commons Committee of Public Accounts has issued a Report on Off-Payroll Arrangements in the Public Sector (i.e. people working for Public bodies that are paid but not as employee).
The high profile criticism of the BBC paying over 300 people through their own personal service companies (or PSC's) continues to rumble on. People are rumoured to include Jeremy Paxman and Fiona Bruce.
If you are a contractor looking to trade through your own limited company or personal services company (PSC) but are unable to open a business bank account because of a poor credit history then PayMatters can help.
In a speech designed to show how well the economy was recovering and how it was prosperity all around it may have been hard to notice that George Osborne had one eye on the huge number of contractors and freelancers that support the economy and its recovery.
Social workers operating through their own limited companies may fall under the HMRC spotlight as they look at sectors they consider to fall foul of IR35.
In the Isle of Man the Income Tax Division on behalf of The Treasury have issued a consultation document with the aim of amending their current legislation in respect of PSC's (Personal Service Companies).
In the Budget it was proposed that all "controlling persons" must be on the payroll of that orgainsation by law.
Key Taxation Changes for Umbrella Company contractors from 6th April 2012 and for Personal Service Companies (PSC's) from 1st April 2012:
