Tax ruling could see contractors out of pocket
30 Aug 2016
If the Government goes ahead with planned tax changes for the self-employed, more than half of the 26,000 Personal Service Companies will leave public sector work, according to the Association of Independent Professionals and the Self-Employed. Currently, it is up to contractors to determine their status, with the Revenue intervening if it thinks this is incorrect. However, from 2017, the Government plans to make public sector clients specify the status of an engagement, rather than the contractor, making the former responsible for applying employment taxes. If the public sector employee doesn’t pay more to cover the “unfair taxation on the engagement”, the move by the Revenue could see contractors not making any money or, worse still, even losing money.
If your self employed status or that of your company has been challenged, or you have any concerns relating to your tax affairs, please contact Paul Attridge or your usual Beavis Morgan partner. Our tax specialists, some of whom are former HMRC Inspector of Taxes themselves, are well versed in dealing with all types of tax issues. We are also readily available to oversee HMRC disputes on your behalf, as well as to represent clients in appeal proceedings before the Tax Tribunal.