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Waldorf
29th February 2016, 15:34
Are we expecting an easy ride on Budget Day?

As the finances have got tighter in the past few months I would not be surprised to find something hidden away on the day.

Remember IR35 was not leaked at the time and was a small note in the Budget documents, let's hope that we don't get something nasty.

LisaContractorUmbrella
1st March 2016, 14:01
I could well be wrong but I have a sneaky feeling that HMRC do have something up their sleeves; in the last meeting we had with them there were a few sphinx like smiles and that's never a good sign :frown

jamesbrown
1st March 2016, 14:05
I could well be wrong but I have a sneaky feeling that HMRC do have something up their sleeves; in the last meeting we had with them there were a few sphinx like smiles and that's never a good sign :frown

I think you're right. I watched Treasury Qs this morning and, in a response to a question about how the gov't are "helping" the self-employed, Greg Hands (Chief Sec) replied that we should wait for the budget. Perhaps it's just me (:laugh), but there was an element of menace about it. Possibly hypersensitive, but this gov't has form.

ps. Gidiot is surpassing the legend of Brown w/r to stealth taxation, and we know he can't raise the main taxes.

LisaContractorUmbrella
1st March 2016, 14:10
I think you're right. I watched Treasury Qs this morning and, in a response to a question about how the gov't are "helping" the self-employed, Greg Hands (Chief Sec) replied that we should wait for the budget. Perhaps it's just me (:laugh), but there was an element of menace about it. Possibly hypersensitive, but this gov't has form.

ps. Gidiot is surpassing the legend of Brown w/r to stealth taxation, and we know he can't raise the main taxes.

I don't think it's just you :frown

northernladuk
1st March 2016, 14:11
I am fully expecting some very nasty surprises. I don't know if it's because I'm just naturally miserable or not but I just feel it in my bones. There has been so much focus on us and attempts to drag us in to line with T&S and divi tax I can't believe for one minute they've taken the foot off the gas. I foresee at least one surprise we didn't expect and a couple we did. I can feel it in my waters.....

SimonMac
1st March 2016, 14:33
There is talk that pensions are going to get hammered, everyone gets relief at a standard rate (25% has been mooted) rather than the upto 45% that is allowed at the moment, I doubt it would affect many people here, although for those who pay in from the company saving 19/20% on CT could this be a small bonus for us in switching to personal contributions instead.

jamesbrown
1st March 2016, 15:07
Pensions is a given, it's just a question of details.

The (endless) uncertainty is more about IR35 and how they plan to reconcile the two different T&S regimes/tests following the Autumn Statement. It's about time they publish the response to the IR35 discussion (approaching 6 months), which should give some clues. They haven't promised that nothing will be implemented in 16/17, just alluded to 17/18 as their target date. They talked about the ESI test being available in the "spring". Silence leading up to the budget would be a good indication that something is afoot :laugh (vs. the trial balloons of the Autumn Statement). There's been a continuous stream of stories since the Autumn Statement about avoidance through self-incorporation, so the pressure hasn't diminished. I think we're all expecting the worst to fall in 17/18, but it may happen sooner.

Fred Bloggs
1st March 2016, 15:34
I had thought that NIC on employer pension contributions was an outsider, but the more I see, the more I think it likely. The chancellor can still claim he hasn't increased the rate of NIC or income tax and the worker will see no impact on his payslip.

WordIsBond
1st March 2016, 19:16
I had thought that NIC on employer pension contributions was an outsider, but the more I see, the more I think it likely. The chancellor can still claim he hasn't increased the rate of NIC or income tax and the worker will see no impact on his payslip.
I'm starting to think this, too.

There have been rumours about a flat rate 25 or 33 percent relief on pension contributions. I don't see 33%, it would actually cost them money because basic rate people would be getting an additional 13%. So I think it will be 25%, enough to claim "I'm helping ordinary working families, but higher rate earners should pay more." (As if they don't already, what a novel idea.)

But higher rate earners can still get 40% with a salary sacrifice so their company pays into the pension. And one way to "solve" that is probably to make employers pay NIC on pension contributions. Chop 13.8% out of that 40% and you are getting close enough to 25% that it really doesn't matter.

I don't see this one as immediate effect, though. Companies need time to change their systems. He might make the personal contributions change have immediate effect, but even that would surprise me a little.

The one that scares me is taking away the tax free lump sum. I don't think he'll do that, but I no longer trust these guys to have any economic sense at all. It would absolutely kill pension savings.

Gordon Brown killed defined benefit plans, this lot are talking about doing things that would kill personal plans.

If you want people to lock their money away where they can't get at it for decades, so that you don't have to support them in their old age, you have to give them an incentive to do it. Most people are too short-termist to do it unless there is a strong incentive. But then, I don't see any evidence that those in power have a long term view, either.

mudskipper
1st March 2016, 22:16
I'm expecting something nasty with pensions - MyCo has just chucked an extra wodge into mine. But it seems likely that personal contributions would be an easier target than employer - although they're likely to follow in that they'll be taxed PAYE before relief applied.

But if we all had crystal balls, we'd walk like gypsies.

MarkT
2nd March 2016, 16:20
I think this board is going to become very busy, just like before the Autumn Statement.....

You can smell the fear.....:sick

Acme Thunderer
2nd March 2016, 20:33
Putting a limit on amount a company can contribute to a pension to be the same as the salary could be a line of attack. Only affects those operating low salary/high dividends, not Mr Average.

WordIsBond
3rd March 2016, 09:38
Putting a limit on amount a company can contribute to a pension to be the same as the salary could be a line of attack. Only affects those operating low salary/high dividends, not Mr Average.
This would be coherent, easy to understand, and easy to implement and enforce. But this is government, so it couldn't happen.

Seriously, if he is just looking to target small business owners again (and again, and again), this would be a way to do it. But it would have no impact on the people who make high salaries in big business. Does he want the headlines to start reporting that he's targeting small businessmen and letting off the fat cats? He could accomplish the same thing and hit the big guys by limiting company contributions to £10K. Something like that could happen.

There are so many ways he could mess things up. I'm sure he'll stumble on a few of them.

WordIsBond
3rd March 2016, 09:41
I think this board is going to become very busy, just like before the Autumn Statement.....

You can smell the fear.....:sick
I'm not really expecting anything significant impacting contractors except something on pensions. Which probably won't have significantly greater impact on us than on other people.

seanraaron
3rd March 2016, 10:06
Does he want the headlines to start reporting that he's targeting small businessmen and letting off the fat cats?

I think if it was indicated he's going after consultants making high five to six figures and not local shopkeepers or companies that employ more than one person and a family member it would be a pretty easy sell.

Most people find the idea of founding a limited company and paying yourself dividends to avoid tax a fairly unsympathetic position, surprisingly enough.

Hobosapien
3rd March 2016, 13:05
Putting a limit on amount a company can contribute to a pension to be the same as the salary could be a line of attack. Only affects those operating low salary/high dividends, not Mr Average.


Didn't the pension contribution limits used to be like that, based on salary?

I seem to remember in my early years as a contractor that (so far the only time I've had an investigation by HMRC into expenses etc) they delved into my personal pension contributions saying I had contributed too much based on the minimal salary I was drawing. I think it was resolved by my accountant showing that I had under contributed in previous years and the rules allowed a roll up of up to 6 years or so, and the total contributions came under the limit for those years rolled up.

In the end, after about 6 months of back and forth with good old fashioned letters, HMRC said I'd done nothing wrong and owed them nothing extra. An accountant can not only save you money but also keep you out of trouble. :smokin

So yes, they may go back to some old rules. Nothing really changes, they just shuffle the deck chairs while the plebs are sinking into the pockets of the rich and foreign. :frown

billridley
4th March 2016, 12:43
Didn't the pension contribution limits used to be like that, based on salary?

I seem to remember in my early years as a contractor that (so far the only time I've had an investigation by HMRC into expenses etc) they delved into my personal pension contributions saying I had contributed too much based on the minimal salary I was drawing. I think it was resolved by my accountant showing that I had under contributed in previous years and the rules allowed a roll up of up to 6 years or so, and the total contributions came under the limit for those years rolled up.

In the end, after about 6 months of back and forth with good old fashioned letters, HMRC said I'd done nothing wrong and owed them nothing extra. An accountant can not only save you money but also keep you out of trouble. :smokin

So yes, they may go back to some old rules. Nothing really changes, they just shuffle the deck chairs while the plebs are sinking into the pockets of the rich and foreign. :frown

Is there still a limit on pensions compared to salary?? I am a bit confused because I asked my accountant if it was ok to pay a personal pension to my wife (direct from the company) who is a director and shareholder - but not an 'employee, i.e. no salary is paid. He said it was ok so I have stated to make contributions. Can anyone advise if my accountant (who provides a great service, no complaints) has got this correct, or is this something I need to clarify? Cheers and thanks.

Hobosapien
4th March 2016, 14:48
No idea what the current rules are, only that I'm conforming. My accountant makes sure of that. They'll change all the rules again on the 16th most likely anyway.

I don't put large amounts into a pension pot these days as they mess around with the rules so often that I cannot be arsed worrying about what state things will be in when I choose to retire, and I intend keeping it my choice.

I saw somewhere the idea of the govermin raising the pension age to above the average life expectancy so they wouldn't have to pay out anything. :laugh

Almost certainly bollox but it epitomises how the govermin can and do play the rules to their own ends and not to the benefit of those trying to secure a comfortable retirement.

jamesbrown
4th March 2016, 15:02
Is there still a limit on pensions compared to salary?? I am a bit confused because I asked my accountant if it was ok to pay a personal pension to my wife (direct from the company) who is a director and shareholder - but not an 'employee, i.e. no salary is paid. He said it was ok so I have stated to make contributions. Can anyone advise if my accountant (who provides a great service, no complaints) has got this correct, or is this something I need to clarify? Cheers and thanks.

The maximum total contribution is 40k (inc. employer contributions), but you cannot personally contribute more than the greater of 3.6k (IIRC), which attracts 20% relief (included in this figure), or the amount of your annual salary. Since your wife doesn't have a salary, the maximum contribution would be the former. I think the problem you may face is whether this is a valid business expense. If you cannot justify paying the wife a salary (i.e. they are doing nothing), how can you justify a pension payment?

billridley
4th March 2016, 15:21
The maximum total contribution is 40k (inc. employer contributions), but you cannot personally contribute more than the greater of 3.6k (IIRC), which attracts 20% relief (included in this figure), or the amount of your annual salary. Since your wife doesn't have a salary, the maximum contribution would be the former. I think the problem you may face is whether this is a valid business expense. If you cannot justify paying the wife a salary (i.e. they are doing nothing), how can you justify a pension payment?

Thanks. I need to query again with my Accountant. I was asked how much I intended to contribute to her pension this year and I said approx £12,000. He said that should be ok. Not so sure now.

jamesbrown
4th March 2016, 15:35
Thanks. I need to query again with my Accountant. I was asked how much I intended to contribute to her pension this year and I said approx £12,000. He said that should be ok. Not so sure now.

I don't think the issue is the limit in this case, because the greater of 3.6k or salary is for a personal contribution (i.e. made by your wife to her own SIPP), not an employer contribution (i.e. made by YourCo to your wife as a director). So, if this is a contribution from YourCo, the overall limit of 40k applies (inc. any personal contribution from your wife). Rather, I think the issue is whether it's a valid business expense, and I don't see how it can be if she isn't doing anything for the company.... but I'm not an accountant.

billridley
4th March 2016, 16:00
I don't think the issue is the limit in this case, because the greater of 3.6k or salary is for a personal contribution (i.e. made by your wife to her own SIPP), not an employer contribution (i.e. made by YourCo to your wife as a director). So, if this is a contribution from YourCo, the overall limit of 40k applies (inc. any personal contribution from your wife). Rather, I think the issue is whether it's a valid business expense, and I don't see how it can be if she isn't doing anything for the company.... but I'm not an accountant.

Thanks for your viewpoint JamesBrown. Perhaps I have to give her an admin job on minimum salary updating my accounting transactions into FreeAgent and filing my expense receipts and company paperwork.

WordIsBond
4th March 2016, 20:40
Well, she's due some compensation for the legal responsibility of being a director. If that is paid in pension, or salary, or if she chooses to forgo it and not have any compensation, doesn't really matter -- some kind of compensation would be entirely appropriate and defensible. Seems very unlikely HMRC would challenge £12K going into a director's pension unless you are doing other stuff wrong and they just want to throw the book at you for everything they can come up with.

I suspect if you'd said £40K your accountant would have said it is a bad idea. £12K? Probably fine. Where exactly the threshold sits would be hard to say. But it is certainly true that you can do something, even if all she does in the company is sign the accounts at the end of the year.

It's going to show up in the accounts as a director's pension, and they are going to say, "Yeah, we see that all the time, nothing unusual there. Anything interesting in the next company's accounts?"

jamesbrown
4th March 2016, 20:58
It's going to depend on the facts of the case. See here (http://www.hmrc.gov.uk/manuals/bimmanual/bim46035.htm). My reading is that the other director doesn't do any work/admin, and hasn't received any remuneration (salary or pension) in the past as a reflection of that. Their pension fund may be underfunded but, if I were looking at those facts, I'd struggle to see this as a valid business expense without some further evidence that they had started to contribute meaningfully (at a 12k level). YMMV. It depends on your risk tolerance. I can see many accountants not being comfortable with that, but perhaps some will chime in...

billridley
5th March 2016, 12:25
Thanks for your comments. Appreciate them. Gave me something to think about. Cheers

WordIsBond
5th March 2016, 14:17
Yeah. My wife does all bookkeeping, bank stuff, payroll, etc. I don't think I'd go to £12K, or even £8K, if she didn't, personally, but I have a low risk tolerance.

Practically, it is probably pretty safe, just because of the difficulty of proving what is "too much" for a non-exec director. It's just not the kind of thing HMRC is likely to challenge. But as you said, YMMV.

northernladuk
5th March 2016, 15:21
Thanks for your viewpoint JamesBrown. Perhaps I have to give her an admin job on minimum salary updating my accounting transactions into FreeAgent and filing my expense receipts and company paperwork.

Cool. That's all of 15 mins a week then. Can't give her a job when one doesn't exist.

billridley
5th March 2016, 18:04
Cool. That's all of 15 mins a week then. Can't give her a job when one doesn't exist.

I wasn't being serious about that. Too near retirement to take any risk.

Waldorf
8th March 2016, 11:06
The OTS report hints at a consultation on IR35, I wonder if this is going to be announced in the Budget on the 16th?

jamesbrown
8th March 2016, 12:05
The OTS report hints at a consultation on IR35, I wonder if this is going to be announced in the Budget on the 16th?

Quite likely. The delay is approaching 6 months already. I suppose it depends whether they have a more comprehensive (read: simplistic) solution in mind. Once it gets to the consultation stage it's essentially a statement of policy intent, unlikely to be reversed or moderated significantly, so we'll then know what's coming (and where to relocate :D).

mudskipper
8th March 2016, 13:37
Quite likely. The delay is approaching 6 months already. I suppose it depends whether they have a more comprehensive (read: simplistic) solution in mind. Once it gets to the consultation stage it's essentially a statement of policy intent, unlikely to be reversed or moderated significantly, so we'll then know what's coming (and where to relocate :D).

The T&S proposal was changed in a way that was quite significant for many of us as a result of the consultation.

jamesbrown
8th March 2016, 13:47
The T&S proposal was changed in a way that was quite significant for many of us as a result of the consultation.

Hence "unlikely". This was a rare "success" (you could say deferral). I believe the reason they stated w/r to the additional burden of two tests in an IR35 caught scenario was, indeed, the real issue, and nothing else. This is why I also believe it's a deferral to IR35 reform, rather than a true success. Lobbying on fairness was not the reason for the about turn. You could hardly say the outcome for umbrellas is fair. In some of these policy areas, they are completely winging it, and they don't understand the unintended consequences, but the general outcome of a consultation exercise is that the gov't proceeds with their preferred option.

Gillingham Jilly
8th March 2016, 14:34
Am I the only one here who thinks there may be a few nasties lurking in this year's budget for us contractors?

Especially in light of Osborne's apparent backtracking on the pensions issue (if he ever intended it in the first place). I mean one minute it's shock, horror! he's going to cut tax relief on private pension contributions - it's assault on middle Britain! The next he clobbers tax avoiding freelancers and I guess nobody gives a damn.

jamesbrown
12th March 2016, 22:55
Can't find the article yet, but bottom left:

https://pbs.twimg.com/media/CdYPjppWwAM9KSv.jpg:large

jamesbrown
12th March 2016, 23:09
More here:

Budget to end stars’ ‘off-the-books’ pay | The Sunday Times (http://www.thesundaytimes.co.uk/sto/news/uk_news/article1677871.ece?CMP=OTH-gnws-standard-2016_03_12)

Darkling
13th March 2016, 00:12
Also in the Mirror:

Budget 2016 to include 'Paxman Tax' on high-earning public sector workers being paid as companies - Mirror Online (http://www.mirror.co.uk/news/uk-news/budget-2016-include-paxman-tax-7546106)

ShandyDrinker
13th March 2016, 08:59
Here we go again... oh joy.

* Actually, re-reading a few of the articles infers this should be public sector works only *

However, I would still like the treasury to justify the statistic that 90% of all PSCs should be taxed as PAYE which is a statistic I see trotted out again and again. Where is the evidence to back this up?

eek
13th March 2016, 09:35
Here we go again... oh joy.

* Actually, re-reading a few of the articles infers this should be public sector works only *

However, I would still like the treasury to justify the statistic that 90% of all PSCs should be taxed as PAYE which is a statistic I see trotted out again and again. Where is the evidence to back this up?

Where is the evidence that it's £3500 in tax lost given that that is the figure they have always used and the dividend tax knocks it down to nothing

pjt
13th March 2016, 10:51
Its in the mail as well!

George Osborne to kill off 'Paxman' tax ploy that costs £400m | Daily Mail Online (http://www.dailymail.co.uk/news/article-3489705/Osborne-kill-Paxman-tax-ploy-costs-400m-Budget-tackle-books-dodge-used-civil-servants-media-stars.html)

Roll on the 16th! Looks bad.

MarkT
13th March 2016, 18:48
Its in the mail as well!

George Osborne to kill off 'Paxman' tax ploy that costs £400m | Daily Mail Online (http://www.dailymail.co.uk/news/article-3489705/Osborne-kill-Paxman-tax-ploy-costs-400m-Budget-tackle-books-dodge-used-civil-servants-media-stars.html)

Roll on the 16th! Looks bad.

Certainly does

I'm convinced they are going to hammer us, however these stories are talking about public sector and not private.

It felt like a let off last time, chances are it won't this time.

SueEllen
13th March 2016, 18:50
Certainly does

I'm convinced they are going to hammer us, however these stories are talking about public sector and not private.

It felt like a let off last time, chances are it won't this time.

He will just up the dividend tax.

I was reading how stupid Gidiot was is fuel duty. He should have configured it so when fuel prices fell he got more money by keeping the price stable and vice versa. So while people wouldn't see a difference in their pockets the Treasury and taxpayers in general would be better of.

MarkT
13th March 2016, 18:54
Not sure he'll do that, lots of tory voters are paying it and won't take kindly to it going up, it won't help his case to be PM one iota.

More likely is he will enforce our employment status to be decided by the end user, the vast majority will take the risk averse option and put us on either their or the agency books.

SueEllen
13th March 2016, 19:04
Not sure he'll do that, lots of tory voters are paying it and won't take kindly to it going up, it won't help his case to be PM one iota.

More likely is he will enforce our employment status to be decided by the end user, the vast majority will take the risk averse option and put us on either their or the agency books.

Big business will complain before working out loopholes.

Remember businesses use people who are self-employed and who work as contractors, and they definitely don't want any of us on their books being able to claim any more rights under the law that we can already can and neither do agencies. While the likes of Accenture don't want us to exist they still use us to fill holes in their resource pools as and when required.

Basically he's screwed as the larger he makes the tax code the bigger the loopholes.

ShandyDrinker
13th March 2016, 19:41
Not sure he'll do that, lots of tory voters are paying it and won't take kindly to it going up, it won't help his case to be PM one iota.

More likely is he will enforce our employment status to be decided by the end user, the vast majority will take the risk averse option and put us on either their or the agency books.


Big business will complain before working out loopholes.

Remember businesses use people who are self-employed and who work as contractors, and they definitely don't want any of us on their books being able to claim any more rights under the law that we can already can and neither do agencies. While the likes of Accenture don't want us to exist they still use us to fill holes in their resource pools as and when required.

Basically he's screwed as the larger he makes the tax code the bigger the loopholes.

I'd tend to agree with SueEllen rather than MarkT on this.

One of the reasons I think it ended up as unworkable in time for the Autumn Statement was the backlash probably encountered from big business and of course from many others.

How many businesses are really going to be prepared to consider contractors as on the books and the potential demands for employment rights longer term than having the flexibility of a workforce they can expand/contract quickly as business demands dictate. Even if the potential issue of employment rights didn't exist, I do think a number of contractors will just pack in and go perm due to the hassle or contract rates will rise as a result. Although there has been talk of an employment status indicator tool I am not convinced this will improve the situation any more that the Business Entity Tests did.

MarkT
13th March 2016, 19:52
I'd tend to agree with SueEllen rather than MarkT on this.

One of the reasons I think it ended up as unworkable in time for the Autumn Statement was the backlash probably encountered from big business and of course from many others.

How many businesses are really going to be prepared to consider contractors as on the books and the potential demands for employment rights longer term than having the flexibility of a workforce they can expand/contract quickly as business demands dictate. Even if the potential issue of employment rights didn't exist, I do think a number of contractors will just pack in and go perm due to the hassle or contract rates will rise as a result. Although there has been talk of an employment status indicator tool I am not convinced this will improve the situation any more that the Business Entity Tests did.

Id love to be wrong!!!!!

SueEllen
13th March 2016, 22:25
Id love to be wrong!!!!!

You have to remember the world of self-employed and contractors covers more than just us.

Even if you consider IT contractors there are those who work direct, have more than one contract at a time, subcontract work out, do fixed price projects and/or have employees.

So if you can think of a tax regulation that would cover all these types of IT contractors without a loophole. Then ensure it covers every other type of skilled professional you can think of e.g. engineers, HR, accountants, lawyers, marketers, then you should be the Chancellor not Gidiot.

MarkT
14th March 2016, 08:57
So if you can think of a tax regulation that would cover all these types of IT contractors without a loophole. Then ensure it covers every other type of skilled professional you can think of e.g. engineers, HR, accountants, lawyers, marketers, then you should be the Chancellor not Gidiot.

Nope

But I still think I'd make a better fist of it......to be fair, my dog could make a better fist of it, and he's scared of cardboard....

bluemonkey71
16th March 2016, 13:15
The Chancellor announces a series of actions to tackle tax avoidance and evasion totalling £12bn, including moves to end the use of "personal service companies" by public sector employees to minimise their tax liabilities. A number of TV personalities have faced criticism for their use of the tax loophole.

westtester
16th March 2016, 13:49
Found this in the main Budget document.



Off-payroll engagement in the public sector

1.148 Some individuals who work through their own limited company are undertaking jobs that would ordinarily mean they are employees of the business that they are working for. In those circumstances, existing legislation on off-payroll working requires them to pay broadly the same taxes as employees. However, non-compliance with these rules is costing the taxpayer around £440 million a year – and these costs are rising.

1.149 Public sector bodies have a responsibility to taxpayers to ensure that the people working for them are paying the right tax. From April 2017, where the public sector engages an off-payroll worker through their own limited company, that body (or the recruiting agency if the public sector body engages through one) will become responsible for determining whether the rules should apply, and for paying the right tax. This strengthens the public sector’s role in ensuring that the workers it engages comply with the
rules.

1.150 The government also recognises that the current rules are seen as complex and can create uncertainty. It will therefore consult on a simpler set of tests and online tools that will provide a clear answer as to whether and when the rules should apply.

matzie
16th March 2016, 13:53
Things I've spotted in the docs so far -

* public sector responsible for determining contractor status and for paying the tax - from April 2017

"From April 2017, where the public sector engages an off-payroll worker through their own limited company, that body (or the recruiting agency if the public sector body engages through one) will become responsible for determining whether the rules should apply, and for paying the right tax. This strengthens the public sector’s role in ensuring that the workers it engages comply with the rules."

* more 'consultation'

"The government also recognises that the current rules are seen as complex and can create uncertainty. It will therefore consult on a simpler set of tests and online tools that will provide a clear answer as to whether and when the rules should apply."

* Loans to participators tax rate raised from 25% to 32.5% - from April 2016

"Budget 2016 announces an increase in the rate of tax payable by close companies under the loans to participators rules so that it continues to mirror the higher rate of dividend tax. The loans to participators tax rate will be increased from 25% to 32.5% in April 2016, with effect for loans, advances and arrangements made on or after 6 April 2016."

https://www.gov.uk/government/publications/budget-2016-documents/budget-2016#support-for-working-people-1

Section 3.30 and following

DonkeyRhubarb
16th March 2016, 13:55
From April 2017, where the public sector engages an off-payroll worker through their own limited company, that body (or the recruiting agency if the public sector body engages through one) will become responsible for determining whether the rules should apply, and for paying the right tax.

So, anyone using a tax avoidance scheme, rather than a Ltd Co, will not be affected. :laugh

Waldorf
16th March 2016, 14:29
I wonder if they are clamping down on contractors in the public sector, see how it goes, see if it works, if it is effective, with a view to extend it to the private sector in the future?

WordIsBond
16th March 2016, 14:41
I wonder if they are clamping down on contractors in the public sector, see how it goes, see if it works, if it is effective, with a view to extend it to the private sector in the future?
Of course that is what they are doing.

And the Lifetime ISA is setting up to kill private pensions. Next year or the year after, they'll say, "Well, everyone on basic rate can do just as well or better with the Lifetime ISA, so it's really only the rich who are using private pensions now. They don't need tax relief."

TheFaQQer
16th March 2016, 17:27
I wonder if they are clamping down on contractors in the public sector, see how it goes, see if it works, if it is effective, with a view to extend it to the private sector in the future?

Yep.

In the past, the Treasury have been told that making it work like this would kill the industry. So this is their chance to show that they were right and everyone else was wrong.

DaveB
16th March 2016, 17:29
Yep.

In the past, the Treasury have been told that making it work like this would kill the industry. So this is their chance to show that they were right and everyone else was wrong.

A lot will hinge on the clients and agencies reaction to being liable for employers NI and collecting PAYE.

It will also depend on exactly what the employment status tests turn out like. For all that people loathed them, the BET's were so badly put together than most people could score a medium or low risk with a little bit of effort, and could back it up with status reviews from QDOS et al.

SueEllen
16th March 2016, 18:22
Of course that is what they are doing.

And the Lifetime ISA is setting up to kill private pensions. Next year or the year after, they'll say, "Well, everyone on basic rate can do just as well or better with the Lifetime ISA, so it's really only the rich who are using private pensions now. They don't need tax relief."

There are more people over 40 than under and it's the people between 40-54 who put the most in their pensions. This age group also votes....

WordIsBond
16th March 2016, 18:28
There are more people over 40 than under and it's the people between 40-54 who put the most in their pensions. This age group also votes....
Oh, he's a LONG-TERM kind of guy, didn't you listen?

People over 40 can't even open a LISA, right? So what's he going to do? Why, take pension relief away for people under 40 -- and then the next year, for those under 41, and so on. "I'm not taking pensions away or changing anything for anyone who is even remotely close to retirement. They can keep their pension." But the savings will go into his forecasts, etc.

CornishYarg
16th March 2016, 21:26
So, anyone using a tax avoidance scheme, rather than a Ltd Co, will not be affected. :laugh
That figures, but.. what kind of scheme have you in mind? :tumble:

SueEllen
16th March 2016, 22:05
Oh, he's a LONG-TERM kind of guy, didn't you listen?


You mean he doesn't want to be attacked when he's PM like Brown about his pensions raid and abolishing the 10p tax rate.

DonkeyRhubarb
17th March 2016, 08:17
That figures, but.. what kind of scheme have you in mind? :tumble:

I was only joking of course. Using a scheme these days is :suicide: