IR35 is the term most frequently used to refer to HMRC’s anti avoidance legislation involving workers who provide their services to businesses through personal service companies, such as a limited company or limited liability partnership.
The IR35 legislation was originally introduced in the Finance Act 2000 with the sole purpose of tackling tax avoidance by freelance contractors and the companies that engaged them.
If you have a query about IR35 fill out a quick Enquiry Form HERE
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IR35 Employment Status Check - Call free on 0808 169 9090
However, in recent years HMRC have shifted the burden from the individuals who provide their services to the companies and institutions who contract with them.
In April 2019 a change in the legislation meant that all public sector bodies such as the NHS or MOD, who frequently use external contractors, would need to review on a case-by-case basis to see if the IR35 legislation was relevant to that contract.
From April 2020, this change also applied to the private sector and all firms who use external contractors are required to assess each contract for IR35 purposes.
These changes are set to be reversed in April 2023, and the onus for determining employment status will shift back to the contractor, as well as the responsibility for paying tax and NIC over to HMRC, where required.
IR35 Contractor Accountants
In providing services as workers through personal service companies, HMRC believed that there were and continue to be tax benefit advantages rather than being employed by the end client. The perceived advantages included Income Tax and NIC for both the personal service company and the contracting company.
The IR35 legislation has been a complex and rapidly evolving area under which HMRC will be seeking to challenge workers employment status by using its Check Employment Status for Tax tool (CEST).
The consequences of falling under IR35 will in many cases mean retrospective tax liabilities, late payment interest and potentially financial penalties for both contractor and company.
Given the complex nature of IR35, the legislation and decisions made by HMRC it will be open to challenge by both contracting workers and the companies who engage them.
At Equatas we can assist contractors and companies in navigating their way through the complex IR35 area. Our experienced team can also assist in making challenges to the Status Determination Statement and the decisions HMRC take regarding employment status.
To discuss more about IR35 and Employment Status Checks with a member of our team call 0808 169 9090
Alternatively you can send an email to enquiries@equatas.co.uk
or fill out an Enquiry Form
and a member of our team will contact you at the earliest possible convenience.
Forths Tax / Forths Accountants becomes Equatas Accountants. Forths Tax / Forths Accountants is delighted to announce that with effect from 1st April 2022, the business has rebranded to Equatas Accountants. As you may be aware, in July 2020, the wider business behind Forths Tax / Forth Accountants was acquired by the listed FCA regulated company, Frenkel Topping Group (‘FTG’) as part of their significant expansion plans. At the date of acquisition FTG already had it’s own small general practice and the rebranding of Forths Tax / Forths Accountants to Equatas Accountants simply serves to bring all of our general practice tax and accountancy services under one roof. From a practical perspective the rebrand will have no impact on our offering and the quality of the service that all clients receive. However, in line with FTG’s own expansion plans, there are also significant growth plans in the pipeline for Equatas Accountants, as we set about widening the services that we can offer to our clients and also investing heavily in various cutting-edge technologies so that we can offer market leading services in the most efficient way. In addition, it is important to note that as Equatas Accountants is a part of FTG, you also now have access to the full range of financial services that FTG provide as Independent Financial Advisers, from the obvious pensions and investment advice to (perhaps less obviously) advice on a variety of different insurance policies. Yours Sincerely, The Equatas Team
There are things you can do to give your business the best chance of survival and success, during and after the pandemic. These steps often go hand-in-hand with the services and advice of an accountant. A key to staying on top of your business’ financial affairs is knowing exactly where you stand. This means knowing your business’ cash flow, as well as upcoming and future tax liabilities. We can provide you with the information to plan and make proactive decisions by preparing your accounts and tax returns. Lockdown is the perfect time to sort out business records and get your accounts up-to-date. As tax advisers and accountants, we regularly contact our clients with updates of any government measures or news that we think may be relevant to them individually. This includes talking to clients about the Bounce Back Loan Scheme which will provide a vital lifeline to many businesses over the coming months. The self-employed, partnerships and companies can all apply for this loan up to a maximum of £50,000. Even if your business does not currently need this loan, it may be worth discussing whether it will be needed in the future, as the knock-on effects of the pandemic on business are uncertain. For clients with employees, we are calculating and submitting furlough claims on their behalf, as well as processing their payroll. We are helping our clients identify which tax payments can be reduced or deferred to support their cashflow over the coming months. We also keep everyone informed of deadlines so that they do not fall behind. All of us at Forths Tax are fully contactable and providing our services as normal via email, over the phone, and through the post. We are also able to speak to you through Zoom, WhatsApp, or Facetime if you prefer. If you are local to Leeds or Manchester and would prefer to drop off your business records, we can arrange a time to meet you at our offices whilst maintaining social distancing. If you would like to speak to us about how we can help you, please call us on 0808 169 9090 or fill out an Enquiry Form and we will contact you directly to discuss your circumstances.
Individuals are quite rightly constantly looking for ways to mitigate their tax position and legitimately minimise what they have to pay to HMRC. The key to this sentence is clearly the word legitimate. In May 2020, the press reported the criminal prosecution of former HMRC employee, Martyn Arthur, for submitting inaccurate tax returns and cheating the public purse out of £120,000, who in 2009 published a book entitled ‘The Taxpayer Strikes Back’ about how to stand up to HMRC. Ironically, it would appear as though he has failed to heed his own advice. Obviously, simply not declaring your legitimate taxable income is not a plausible tax planning strategy and we would certainly not want any of our clients to be in the same position as Mr Arthur. We recognise, however, that there are numerous different ways that individuals can find themselves in a position where they have an issue with HMRC that will be causing them stress and anxiety. Our unequivocal recommendation when individuals find themselves in this position is to contact an appropriately qualified and experienced tax investigation specialist to guide them through what may seem like a maze. A tax investigation specialist with an in depth knowledge of the relevant process will robustly present the tax payers position from a technical perspective and also provide assurance that all features of their case have been properly considered. Further information about our specialist tax investigation and disclosures services are available on www.taxdisclosures.co.uk We provide both tax planning and tax investigation services. To discuss your circumstances, call us on 0808 169 9090 or fill out an Enquiry Form and we will contact you directly.
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To hear more about our services or to discuss your circumstances with a member of our team, call us on 0808 169 9090.
Alternatively, you can email us at
enquiries@forthstax.co.uk
or fill out an Enquiry Form
and we will contact you directly.