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IR35 -- Why It MattersThe perceived need for the IR35 avoidance rules stems from the differences in the way in which employees treated for tax and National Insurance purposes compared to a worker who provides his services through an intermediary, and from the fact that HMRC will generally collect more tax and National Insurance in respect of an employee than in relation to a worker who provides services via an intermediary.Where a worker is employed, the worker pays tax under PAYE and both the employee ... Continue Reading

The Low Incomes Tax Reform Group (LITRG) has called for changes to avoid people being discouraged from starting self-employment and existing claimants being forced to give up their work. Introduction The changes LITRG is arguing for include: allowing self-employed claimants with fluctuating income to average their income over a period of up to a year changes to the calculation of the ‘minimum income floor’ and increasing the start-up period during which it does not apply from one ... Continue Reading

Not so much a broadside as a 50-page sustained bombardment, HMRC lost this penalty case – badly. And rightly so. And our work gets a mention, too. Introduction Readers will be aware that we at TaxationWeb are not huge fans of the current penalty regime, particularly where the penalties dwarf the underlying tax at stake. In HMRC’s Penalty Regime Laid Bare, we highlighted one of the most objectionable offspring of the FA2009 Sch 55 penalty regime: as it applies to the Non-Resident Capital ... Continue Reading

Update HMRC has announced that its fix for several of the errors in its 2016/17 Tax Calculation will take effect from Monday 23 October. HMRC says that, unfortunately, some “issues” were picked up, that it was unable to fix before 6 April 2017. Which might surprise some, since we were warning about the problems as far back as January 2016! (and in July 2016 - Gov.Fail: Have the New “Allowances” Foiled Even HMRC?. Oh – and in October 2016, with Dividend and Savings ... Continue Reading

LITRG has produced a new factsheet in partnership with PRISM on ‘working through an umbrella company’ to support temporary workers having to grapple with working through an umbrella company. Introduction The new ‘working through an umbrella company’ factsheet offers guidance to those working through an umbrella company around their tax and employment status and provides practical tips to help them avoid any problems with their pay and deductions. It has been written with ... Continue Reading

Your intrepid reporter attended the ICPA’s Practice Evolution conference today – it was in Manchester, so it would have been rude not to. The event was very well attended and, from the accents on display, even Manchester’s delightful “ring of bollards” had not stopped people attending from much further afield. Tony Margaritelli is the ICPA’s chairman, and hosted the event, and we were able to catch up afterwards. Needless to say, Making Tax Digital was still a ... Continue Reading

Tax Saving Through Joint Ownership – Summary Of BenefitsThe precise saving potentially to be made will depend on the particular circumstances, with due regard to adjustments for pension contributions, gift aid, and particular types of income and gains, but as a general rule, for 2017/18: Where a 40% taxpayer is able to share his or her income with another who has unused 20% Basic Rate band, then the overall tax saving can be as high as £6,700 for each additional joint owner (Basic ... Continue Reading

Why Set Up A Trust?When a person makes an outright gift to someone, either during their lifetime or on death in their will, the new owner assumes all rights over the property to deal with as they wish. In comparison, the creation of a trust enables the person who is making the gift (the 'settlor') to attach certain conditions.Trusts have been recognised in English law since at least the thirteenth century and are assumed to have come into being at the time of the Crusader knights, as a way of protecting ... Continue Reading

LoansOne of the many ways to extract cash from your family company is for the company to lend you money. This can be a useful source of short-term finance and, used wisely, can be tax-effective. However, tax charges may arise on the company if the loan is not repaid by the time that the corporation tax for the period is due. Company’s PositionFrom a company’s point of view, where the company is a close company, if it lends money to a shareholder (or to an associate of a shareholder, such ... Continue Reading

It has been widely reported that the MP Nicky Morgan, who was recently made chair of the Treasury Select Committee, has written to HMRC's Chief Executive to take him to task over problems with the new Childcare Service. This appears to be in anticipation of consideration by the TSC.  It seems that not only are parents, etc., unable to access their digital services account, but so are childcare providers; and there are also apparently "technical difficulties" when frustrated users try to telephone ... Continue Reading