The Chancellor’s budget announced that off-payroll rules will hit the private sector in 2020. Amidst uncertainty over Brexit, there are widespread concerns that the reforms will damage business and weaken the economy at a critical time. ContractingWise takes an overview of the off-payroll developments to date.…
READ MOREMutuality of Obligation or MoO is a feature of employment law that relates to contractual agreements. In the simplest sense, it refers to the obligation of an employer to provide work and pay for it, together with the obligation of the employee to personally do the work.…
READ MOREFollowing the invitation by HM Treasury to submit a Budget representation, the Institute of Chartered Accountants in England and Wales (ICAEW) have released their suggestions. In their submission, they state that there should be “no new tax policy initiatives” in the Autumn Budget.…
READ MOREIn the event of an IR35 inquiry, HMRC will attempt to establish the true relationship between the contractor and the end client in order to determine employment status. As many contracts are generic, the investigating officer will often place more emphasis on what’s known as the ‘hypothetical contract,’ formed by the impressions they gather about the day-to-day working practices of the contractor while on a given assignment.…
READ MOREContractors who reduce their tax liabilities by billing their clients via their own limited company will know that they should do everything they can to avoid falling into IR35 rules.
One mechanism for doing this is to keep detailed timesheets which will allow you to demonstrate to a HMRC investigator that you are in fact self-employed and not a ‘disguised employee’.…
READ MOREThe Inland Revenue’s 35th press release in 1999 was titled IR35: Countering Avoidance in the Provision of Personal Services. It was released on the same day as the budget statement and continues to exist. The legislation was designed to tax “disguised employment” at a rate similar to employment.…
READ MOREThe prospect of an IR35 investigation is sure to unnerve any contractor whose fees are paid through their own limited company. Even if your tax affairs are entirely in order, dealing with HMRC investigators can be a serious distraction and eat into time you could be spending on clients and although you may be confident that you can prove you are truly self-employed, there may still be a risk that HMRC disagrees and demand ‘unpaid’ taxes and a possible penalty.…
READ MOREOn the back of new changes restricting tax relief on travel and subsistence expenses for temporary workers, independent professionals contracting through their own limited company / PSC are to face a new test to determine whether they are in/out-of-scope of IR35.…
READ MOREThe great advantage of being a self-employed contractor is that you can minimise your exposure to tax. Taking advantage of various tax breaks means you can be much better off than as an employee.
But tax can seem like a minefield to new contractors.…
READ MOREOne of the great benefits of being a self-employed contractor is that you can reduce your tax liabilities in ways that permanent employees can’t.
Whilst you might be contracting to take home your hard earned money, it’s also important to know how the UK tax authorities deal with self-employed people, particularly a rather complicated set of rules known as IR35.…
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