Ruling reveals contractor pursued by HMRC despite failing all key employment tests
Engineering contractor Phil Hughes and his contractor limited company Marlen were pursed by HMRC even though he clearly failed all the key tests of employment. The full ruling published recently reveals that Judge Lady Mitting almost called a halt to the tribunal hearing because the evidence against HMRC’s case presented by Accountax Consulting’s Nicola Smith was so compelling. Lady Mitting continued the tribunal “for the sake of completeness.” More…
Contractors may face ongoing uncertainty over IR35 due to HMRC funding cuts
Contractors anticipating reforms to how HMRC administers IR35 through the work of the IR35 Forum could be left to suffer ongoing uncertainty due to budget cuts. According to a report by the National Audit Office (NAO), HMRC has not “sufficiently defined the business performance and customer service it intends to achieve”. The £1.6bn cuts will see HMRC lose 10,000 staff and many offices, meaning the creation of any IR35 specialist units could be delayed, or even cancelled, before the work of the IR35 Forum has even begun. More…
Scottish contractors enjoy strongest rate rises in six months
Contractors working in Scotland have seen the strongest rate rises in six months and demand for their services continues to grow. This is according to the Bank of Scotland Report on Jobs, which also identifies IT & computing as the fastest growing area of temp and contract recruitment. Demand for engineering and construction contractors also grew “solidly”, according to the report. Dundee, the centre of the UK’s gaming industry, saw the greatest increases in contractor demand and shortages of candidates. More...
Contractors may receive fairer treatment if HMRC remains true to its updated litigation strategy
Contractors may receive fairer treatment from HMRC if the tax-gathering organisation remains true to its updated Litigation and Settlements Strategy, which promises to “apply the law fairly and even-handedly”. If HMRC genuinely adopts this approach, it should lead a more consistent application of IR35 legislation. The strategy emphasises a non-confrontational dispute resolution approach, which would appear to be at odds with what contractors have routinely experienced over the ten years that IR35 has been in force. More…
Contractors owing tax may face demands from debt collection agencies
Contractors with outstanding tax bills may in future receive demands from debt collection agencies acting on behalf of HMRC. Accountancy Age’s Jaime Kaffash reports that HMRC has appointed ten debt collection agencies tasked with collecting up to £1bn a year from debtors owing small amounts of tax. This follows a pilot scheme during 2010-2011 in which four agencies were targeted to collect £140m. Baker Tilly’s Alex Pillmoor told Accountancy Age: “The debt collection agencies will only be paid for amounts collected and can therefore be expected to be more persistent than HMRC has recently been.” More…
Interim management contractors turn away from agencies to find work
Fewer interim management contractors are choosing agencies to find work, with many looking to former clients to stay in contract. The results of the Institute of Interim Management’s (IIM) Interim Management Survey 2011 also highlights a huge gender imbalance towards male contractors, although the number of female interims has increased by 4% compared to the 2010 survey. The survey also reveals that assignments in London and the South East dominate the interim management contracting sector. More…
Construction contractors to receive forward details of government construction projects
Construction contractors can expect to benefit from a £22bn investment into public sector construction projects over the next three years and, for the first time, the government plans to publish a full pipeline of projects. The pipeline, to appear in the autumn, is designed to allow the construction sector to effectively plan and prepare for future projects. At the same time, the government is hoping to achieve cost reductions of up to 20% by better procurement. More…
Contractor umbrella solutions providers may face probes into ‘pay day by pay day’ models
Contractor umbrella solutions providers may face probes by HMRC into their operation of ‘pay day to pay day’ tax relief models. In a statement, HMRC has said that these models, which calculate income tax and National Insurance Contributions (NICs) using a snapshot of a contractor’s weekly or monthly pay and expenses, do not comply with tax and NIC legislation. Its statement offers a stark warning to umbrella companies, and their contractor clients, that “HMRC is seeking to identify those businesses currently operating pay day by pay day relief models.” More…
Contractor report to target MPs and Ministers in the autumn
A report on the benefit contractors bring to the UK economy will be published by the All Party Parliamentary Group (APPG) for the freelance sector and PCG in the autumn. The report will target MPs and Ministers and its objective will be to educate policy makers about the ‘value of freelancing’. PCG has pledged to conduct more research into the contracting sector in time for the report’s publication. More…
Contractors can name and shame late paying clients on new government website
Contractors experiencing late payment from government departments and from clients with government contracts are being encouraged to ‘name and shame’ the guilty parties by Minister for the Cabinet Office, Francis Maude. He said: “We expect our suppliers to…pay sub-contractors well within the 30 day limit. When work has been done, especially by an SME [small to medium sized enterprise], it is just inexcusable not to pay up quickly for that service.” More…