Crackdown on personal service companies could raise £400m in tax

[LondonManc]

"Geographical immobility" is a problem, especially among the lower paid, so that sounds like a good idea. For that reason I agree it won't happen.

And discriminates against those with kids who are settled.

[centurian]

How much would HMRC lose in VAT if we all got put on payroll?

Net - Nothing - because surely all ClientCo's will be VAT registered, so will claim it back anyway.

There will be a few that can't claim it back - but this will be offset by no longer having so many contractors on the flat rate scheme, for which most contractors tend to make a small gain in gross receipts.

[diseasex]

Net - Nothing - because surely all ClientCo's will be VAT registered, so will claim it back anyway.

There will be a few that can't claim it back - but this will be offset by no longer having so many contractors on the flat rate scheme, for which most contractors tend to make a small gain in gross receipts.

what a bulltulip news.

[EternalOptimist]

I just heard that they are introducing US 20's style prohibition. just for IT contractors though. Everyone else including IT permies will be exempt.



I don't think they want us to be contractors any more

[Zero Liability]

I just heard that they are introducing US 20's style prohibition. just for IT contractors though. Everyone else including IT permies will be exempt.



I don't think they want us to be contractors any more

We'll be featuring in Gideon's own amateur production of The Hunger Games.

[MicrosoftBob]

We'll be featuring in Gideon's own amateur production of The Hunger Games.

Nah that would mean some of us would live, surely wants to make IDS look like a fluffy bunny and his remit for IT contractors is Arbeit macht frei

[diseasex]

If they would implement stupid law like this (which sounds just stupid) I would simply register offshore and claim to be larger than I am or claim to be another another india bob company (which is allowed!) to which works is being outsourced. Or do contracts in norway or in dubai. Either way they wouldnt see a penny, and instead making 400m they would get -400m

[Contreras]

I don't for a minute believe this comes in. Business is not going to want to put every temporary resource they access on payroll.

They won't need to if offered an alternative - e.g. FLC.

[d000hg]

Well I have it in a separate business account, based on the relevant assumption - but when a contractor is on anything above a very small day rate they will exceed the 40% threshold very easily, so lets assume 1st April 2017 I'm on say....£250 a day - via PAYE that means they assume I will be paid that all year (as they will assume I get paid holiday), and tax me accordingly (£65k gross) - throwing it through a salary calc thats £20k of deductions BEFORE employer NI of £7.8k which I don't know if it will be taken at source or not, assuming they do... £28k of deductions that they will profile over the full year and therefore take £2333 off me every month.

Per month

Income of £5250
Deductions of £2333
Leaving me £2917.

If I am only in the gig for three months then on the bench the rest if the year...

I have £8751 in my pocket, but I've paid out £7k in deductions - the vast majority of which I am due back, but I won't have access to it until rebate time (which I always thought happened after the turn of year...but perhaps not)

I assume there is some way to ask for it back in advance? If there isn't it's highly unfair making people wait 9 months + for their own money back, and if there is then the dept better bulk up, cos they are going to get hit with a lot of claims.

Imagine bouncing on and off the bench, there will be refund requests, and PAYE income shuttling in and out all year.

My point is, PAYE and temporary workforce isn't a very good match!

Well I don't agree they will assume you get paid holidays if you don't. But leaving that aside as not grossly affecting things, your example is not looking great

However, this also assumes we would have to work through PAYE rather than filling in a personal SATR. Same tax due, but deductions not taken directly from salary. But I've no idea what you have to do to work this way, I don't believe Johnny Permie can just opt out of PAYE on a whim for instance?

[vetran]

They would be foolish to allow people to opt out of paying monthly far too many would forget to pay. I suggest they create a PAYE lite that covers a contractors needs.