Employment Tax

Technical
1 July 2017

April 2016 saw new rules limiting home to work travel and subsistence expense relief for workers employed through an intermediary, such as an umbrella company. Even where such expenses could be allowed, other new rules restrict the ways in which umbrella companies can reimburse workers’ expenses. LITRG reviews how the April 2016 rules are operating in practice. Umbrella companies have had to adapt and you may start to see some interesting issues in practice as a result.

Technical

The review, led by Matthew Taylor (Chief Executive of the Royal Society of the Arts), was commissioned by the last government to consider how employment practices need to change in order to keep pace with new forms of work – in particular those driven by online platforms. In their submissions to the review, the CIOT and LITRG both highlight the importance of tax – something not formally within the remit of the review – in the debate.

Technical
1 June 2017

The first Finance Act of 2017 introduces new IR35 rules for workers in the public sector, changes the way salary sacrificed benefits-in-kind are taxed and imposes a 25% tax charge on transferring pension savings offshore.

Technical
1 May 2017

New rules contained in the Finance Bill are designed to remove the tax advantages that arise when certain non-cash benefits-in-kind are provided as part of a salary sacrifice or flexible benefit arrangement. The changes affect more than traditional salary sacrifice so that, broadly, where an employee has an option to receive cash or benefits, the new rules may be relevant. If the new rules apply then the higher of the cash equivalent of the benefit-in-kind and the amount of salary forgone, less any amounts made good by the employee, is subject to tax and employer’s NICs.

Technical
1 May 2017

We round up four HMRC forum meetings from March: (i) the Employment and Payroll Group (ii) the Collection of Student Loans Consultation Group, (iii) Pensions Industry Stakeholder Forum and (iv) Construction Industry Scheme Operation Forum.

Technical
1 May 2017

On 20 March HM Treasury published a call for evidence into the future of employee expenses . The CIOT and ATT will be responding to this consultation and we would like our members’ input to inform our responses.

Technical
1 April 2017

New IR35 rules take effect from 6 April 2017. Where the engagement is with a public sector body the responsibility for deciding whether or not IR35 applies moves to the public sector body. If an engagement falls with the new IR35 rules then the person paying the PSC (that is the public sector body or third party agency) is responsible for deducting tax and NICs under PAYE. A new online tool from HMRC (the ‘employment status service’) will be made available to assist in deciding whether or not IR35 applies to an engagement.

Technical
1 April 2017

A tax charge is being introduced on ‘disguised remuneration loans’ outstanding at 5 April 2019. This charge is to be collected via PAYE. Additionally, new ‘disguised remuneration’ rules are being introduced for the self-employed, similar to those currently applying to employees. Finally, corporate deductions for contributions to employee benefit trusts are to be denied unless the associated PAYE/NIC is paid within 12 months of the end of the accounting period.

Technical
1 March 2017

The Financial Conduct Authority (FCA) have consulted on handbook changes relating to the Lifetime ISA. LITRG’s response points out that tax complexities need to be considered by advisers.

Technical
1 March 2017

LITRG responded to the Committee’s inquiry highlighting concerns about the impact of the current structure of universal credit on the self-employed.