Last week Chancellor Rishi Sunak delivered the Spending Review 2020. The document contained a calculation that his decision to delay private sector IR35 reform by one year has cost the government £740million in lost tax revenue. Contractor bodies have expressed shock that the government is placing this projected loss at the feet of limited company contractors who they suspect of operating as employees.…
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When it comes to contractor concerns, a recent industry poll showed that 62% view IR35 reform as a greater threat than Covid-19 and Brexit combined. This could explain the slow uptake with self-employment, despite the spate of recent redundancies. In times of economic crisis, entrepreneurship and microbusinesses have traditionally played a critical part in economic recovery, helping to establish new markets and increasing flexible access to skills.…
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The infamous IR35 rules have yet again come under fire during a Treasury Committee session last week. The Treasury Select Committee addressed how the UK taxation regime may need to change to accommodate the considerable increase in government borrowing caused by the coronavirus pandemic.…
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‘This Morning’ presenter Eamonn Holmes is to challenge an employment status decision made last February that confirmed he was liable to pay £250,000 in unpaid taxes. Holmes has filed an official court listing, claiming that the Treasury is attempting to rewrite the rules.…
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‘Mutuality of Obligation’ (MOO) is one of the three key tests used to determine IR35 status. Along with ‘Right of Substitution’ and ‘Supervision, Direction and Control,’ MOO is the most frequently referenced status tests in tribunal cases. This means that contractors should have a basic understanding of the test in order to ensure that it is properly worded in their contract, and observed in their daily working practice.…
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Now that changes to the off-payroll rules have been confirmed for April 2021, many contractors will be wondering what they can do to prepare for it. Despite the one-year reprieve that was granted because of the Coronavirus pandemic, it would be unwise to follow the government’s claim that contractors and end clients don’t need to act before the deadline.…
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In light of reforms to the off-payroll rules coming into force in both the public and private sectors from April 2021, the end client will be obliged to provide the contractor with an official Status Determination Statement (SDS). The statement must confirm whether an engagement is inside or outside of IR35 and provide an explanation for this decision.…
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An unexpected ruling at the Upper Tribunal has seen HMRC come out on top in the case of presenter Paul Hawksbee. The Judge, Mr Justice Zacaroli, overturned the verdict of the First-Tier Tribunal (FTT), which found in Hawksbees favour back in June 2019.…
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In its latest representation on behalf of ICAEW, the Tax Faculty has concluded that the government should not consider the proposed amendment to the Finance Bill that would introduce the expansion of IR35 reform to large private sector companies.
Released on the 5th of June, the report states that further considerations of the new off-payroll working regime should be delayed pending an autumn Finance Bill.…
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IR35 reform is set to be extended to the private sector in 2021 after a tabled amendment to the 2019-21 Finance Bill failed to gain the support of the Labour Party. The amendment, tabled by conservative MP David Davis, proposed that the private sector rollout be postponed until the tax year 2023-24.…
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