Increasing publicity over IR35

19th October 2018

In the run up to the Autumn Budget, where it is widely speculated the Government will clamp down on IR35 in the private sector, barely a week goes by without another IR35 case being in the news.

Employment tribunal claims are increasingly being launched by those caught by the IR35 reforms of the public sector. HMRC recently settled such a case out of court with one of their marketing consultants. HMRC had used their CEST employment status tool and found the engagement was caught by IR35. The worker therefore claimed she was entitled to holiday pay. Having settled the claim in full, albeit out of court, engagers may now have legitimate concerns of whether the existence of a limited company gives protection against employment rights.

In a second case, a contractor caught by IR35 had employers’ National Insurance contributions deducted along with the expected PAYE and employees’ National Insurance contributions. The tribunal judge found that the contract was not caught by IR35 at all; an embarrassment for HMRC as their CEST employment status tool had been used to make the decision. Taking a case to employment tribunal in these circumstances may now always end in the contractor getting money back – either the unlawfully held National Insurance, or a greater pay-out if the contract is found to be outside IR35.

Despite the issues surrounding workers employments rights and the accuracy of the CEST employment status indicator, it is still rumoured that private sector IR35 reforms will be announced in the Autumn Budget on 29 October. This would leave only the implementation date open to speculation – April 2019 or April 2020?



 
Other items in Blogs
 
Lucy Bayliss
11th April 2019 £10 a day from the 1st May!

If you submitted your tax return after the filing deadline of 31 January, or you still have not submitted your tax return, then you will automatically be fined £100 for missing the deadline.   In February, HMRC announced that they would be delaying issuing the late filing penalty notices due to Brexit. They have now…

Read More »

Matilda Mawson
10th April 2019 Has your claim for marriage allowance transfer been refused?

  HMRC have recently attempted to remove a marriage allowance transfer for a couple, where the transferor had less than the 10% personal allowance unused. This treatment is incorrect as outlined below:   Background to the transfer The marriage allowance transfer was introduced from 5 April 2015 onwards and allows a person to transfer 10%…

Read More »

Lisa Smith
9th April 2019 Digital Records for VAT – HMRC Guidance published

  From 1 April 2019, most businesses with a taxable turnover above £85,000 are required to follow the rules for Making Tax Digital for VAT.  As a result, HMRC has published new guidance on record keeping, which  explains what records a business needs to keep digitally if it has signed up for Making Tax Digital…

Read More »

Ian Piper
9th April 2019 R&D Tax Relief: HMRC Try to Tackle Abuse

  Many companies, not just those in the tech industry, will have benefitted from the generosity of R&D tax relief. Eligible R&D expenditure can be inflated by a notional 230% uplift, and a refund of tax claimed on tax that was never paid in the first place. Perhaps not unsurprisingly, HMRC have identified abuses of…

Read More »

Adrian Mackenzie
25th March 2019 When doing nothing is best

From time to time, stock markets go through periods of uncertainty. This could be down to some poor economic news or perhaps due to a political crisis.  The sharp falls that can be experienced at such times are understandably unsettling for investors. They can even tempt some to change their long-term plan by selling their…

Read More »

Thomas Carter
21st March 2019 Preparing for Brexit – Do you trade within the EU?

Your UK business may need an Economic Operator Registration and Identification (EORI) number if we leave the EU with no deal.   What is an EORI number?   An EORI number is a unique identifying number assigned to individual importers and exporters to track trade between the EU and non-EU countries. It’s used during Customs…

Read More »