37% of contractors have faced HMRC fines
A new survey of 2,000 contractors shows that over one third have received an HMRC penalty or fine. The poll, carried out by umbrella company provider, Paraplus, suggests that the main reason why contractors have been penalised are; problems with submitting forms to HMRC, and a lack of understanding over HMRC guidelines. Given the contracting industry’s experiences with the much-hated IR35 legislation, these findings will come as no surprise to our readers.
Given ‘ignorance’ is not accepted as an excuse for late submission of accounts, or mistakes made in calculating your tax, employing a competent accountant, or compliant umbrella company would seem to be the most prudent move for would-be contractors.
HMRC to increase IR35 compliance capabilities
Contractor site, Contractor UK, says that the number of specialist HMRC teams undertaking IR35 compliance work is to be increased from 3 to 4. As we reported in last week’s Webwatch, at the latest IR35 Forum meeting, HMRC were unable to provide current figures for the number of IR35 investigations underway, although independent experts expect the number to exceed 1,000 in future years.
PCG holds ‘off payroll’ briefing for public sector contractors
In light of the Government’s new measures to clamp down on the use of contractors in the public sector, contractors’ organisation, PCG, for Ministry of Justice contractors earlier this week. MoJ contractors have been ask to complete ‘working practices questionnaires’ to demonstrate that they are meeting their tax obligations.
With no uniformity in the way Government departments are handling the new checks they have been asked to make on contractors, one speaker said: “…the approach the MoJ are using at least offers some hope that the majority of contractors will able to continue in their roles there.
Contractors await BN66 (retrospective taxation) vote
ContractorCalculator discusses the future of retrospective taxation, as contractors potentially affected by BN66 (a retrospective piece of legislation aimed at user of offshore tax avoidance schemes) await a Commons vote on an amendment to this year’s Finance Bill. Should MPs fail to agree on the amendment, “a dangerous precedent may have been set” which would allow the Government to implement further retrospective tax measures