Have umbrella companies told their clients what their plans are after April?

[jamesbrown]

The changes are specifically concerned with tax relief on home-to-work (H2W) travel. There should be no problem with claiming expenses that are outside of the scope of H2W travel, such as offsite visits, or any other expense that an ordinary employee could claim via a SATR. However, one important difference (introduced in a separate piece of legislation) is that all eligible expenses (e.g. H2W travel when not subject to SDC or other expenses that are not H2W travel) must now be claimed through a SATR. That's my understanding, anyway, although I haven't looked into the details w/r to the umbrella model, as I don't use an umbrella. Bottom line, you should be fine in claiming any expenses that an employee would ordinarily be able to claim via their SATR, but you will only be able to claim tax relief on expenses for H2W travel via your SATR and subject to agreement that SDC does not apply.

[BenDover]

Your normal place of work will not allow you to claim travel & subsistence but if you are sent on a work detail by your end user then yes the claim would be allowed.

I have read the draft legislation a number of times and it is my understanding that any Contractor working through an intermediary (agency) is automatically considered to be caught by SDC, the only way this could be removed is for a director of the end user to sign a document stating that you are not supervised etc but by doing so he/she then becomes accountable for any shortfall in paid taxes/NI.

Why people are thinking that there will be some sort of test to measure where you have SDC or not is slightly confusing me? The draft legislation clearly states that the intermediary is the measure and it is the case for guys working through CIS, Umbrella and Ltd Co.

It is how I read it anyway, I could be wrong but it seems they want to make things clear cut and by doing this they will have succeeded.

Hi, I've just received an email from Brookson stating what change is about but its totally lost me, loads of words but no real substance.
I've worked at current location for about 5 years now so can't claim T&S to normal place of work as over the 2 year cut off.
However, occasionally I do need to work offsite (about 100 miles away) away so stay in a hotel and on return claim hotel, food and petrol money which I do by submitting an expenses claim through my Umbrella Company who invoice company where I actually work and then I get money back a week or two later.
From what I've managed to determine so far is that I am subject to SDC (surprised if anyone isn't) so am I correct in assuming that I can't claim 'any' of my expenses back until the end of the financial year or is it just the tax relief I can't claim?
For example, say hotel is £400, food is £50 and petrol is £45 (£0.45 a mile I think, may be wrong but just an example) does it mean I can only claim all of this back once a year?
Travelling off site at the moment is rare but it looks like it will ramp up in about a year and if I can only claim once a year that's going to be a killer for me. I don't really want to go Ltd but this may force me to.
I'll send above to Brookson as well to see what they say but there seems to be almost zero info on what's actually going to happen.
Cheers
Chris

[BenDover]

Bullet Points Reminder of Draft Legislation

Follow the link and have a read of an easy to understand draft legislation, posted on this site last July but not much has changed from this.

Will ANY contractor pass HMRC's proposed Supervision, Direction and Control test? :: Contractor UK

[lucyclarityumbrella]

I have read the draft legislation a number of times and it is my understanding that any Contractor working through an intermediary (agency) is automatically considered to be caught by SDC, the only way this could be removed is for a director of the end user to sign a document stating that you are not supervised etc but by doing so he/she then becomes accountable for any shortfall in paid taxes/NI.

Why people are thinking that there will be some sort of test to measure where you have SDC or not is slightly confusing me? The draft legislation clearly states that the intermediary is the measure and it is the case for guys working through CIS, Umbrella and Ltd Co.

From what we understand this is a "presumed guilty until proven innocent". For umbrella workers, there will be an automatic assumption of SDC. Speaking with HMRC we have been trying to ascertain what would be deemed as "appropriate" evidence of no SDC. They have said confirmation could come from either the end user or the contractor, in reality and after conversations with our employment lawyers, for protection all round this would need to be confirmed by all parties involved in the chain to show the checks have been made correctly... Not sure how the proof for the "right of SDC" can be documented though

[jamesbrown]

Not sure how the proof for the "right of SDC" can be documented though

In the same way.

"X and Y agree that there is no right to supervise, direct or control the manner in which contractor Z provides their services under contract Q. Signed X and Y."

Or your preferred legalese.

I don't think the problem is evidentiary, it's the difficulty of getting everyone to agree, in writing, given the liabilities involved. Unlikely to happen, easy to evidence.

[DallasDad]

From Giant today

There are some changes coming from HMRC which will mean a few amendments to our umbrella service from 5th April 2016.

This first update will be a quick overview for you and we will be sending a series of weekly updates detailing the changes.

The new Legislation will be published on 17th March 2016. We will outline the full details once we have them. This is what we know so far:

HMRC have said they will restrict tax relief on reimbursed expenses through your payslip. So we can't pay most expenses tax free anymore but the good news is HMRC have said we will still be able claim the tax relief for you at the April tax year-end plus we can still give tax relief on business mileage expenses through your payslip as we do now.

We are releasing changes soon so that you can also claim for computer equipment which gives tax relief through your payslip meaning you don't have to wait.

If you claim 'home to work' travel and subsistence you can still claim it if you are not under the 'supervision, direction or control' of the hirer as to how you do your job. We are working with HMRC, FCSA and the agencies to agree what the process to check this will look like. Remember, even if you cannot claim these expenses anymore, there are still many more that you can claim.

Any expenses incurred by you prior to 5th April must be entered and authorised by us before 5th May for us to process them in your next available payslip.

Finally, we are working very hard to expand giant advantage for you to save thousands of pounds on a more diverse range of benefits.

New offerings will include personal accident insurance, free for all registered users. We are adding salary sacrifice schemes for cars, mobile phones, bicycles and childcare vouchers plus an unlimited employee assistance programme for any personal and professional issues. We are adding more shopping discounts and a giant Visa card where you can claim cashback and many other benefits. We have also added many other options such as free credit checks, car financing, personal loans, preferential currency exchange rates, private medical insurance and wealth planning.

Remember giant accounts can help. If your rate is over £16 per hour and you haven't thought about having your own limited company, we recommend you talk to your ESO or call our best advice team on 020 7167 4444 and get your very own review to see if a limited company (PSC) is a better option for you.

[seanraaron]

Got that as well. I've already rebuffed an attempt to sell me on their Ltd service; I expect I'll have someone trying to convince me it's ok to claim expenses at some point too.

[northernladuk]

Got that as well. I've already rebuffed an attempt to sell me on their Ltd service; I expect I'll have someone trying to convince me it's ok to claim expenses at some point too.

You can claim expenses....

[seanraaron]

You can claim expenses....

If I want to pretend I'm outside IR35 or trust my umbrella company if they tell me this. No thanks, I'll stick to my own judgment on that.

[jamesbrown]

If I want to pretend I'm outside IR35 or trust my umbrella company if they tell me this. No thanks, I'll stick to my own judgment on that.

You've really not understood these changes, have you?