HMRC Discussion Document on Expenses

[Zero Liability]

As an aside, I am guessing the payments eligible to be reported will be those actually made after July 2015, irrespective of whether they are being paid for services that took place before then.

[tractor]

.....

Could this drive up our rates to compensate, or keep them flat, drive contractors out the market and set up clients to engage larger consultancies more?

It won't affect me that much as I don't the Mon-Fri stay over thing.

Bingo!

That has been the aim of HMRC and successive governments for decades. Why pay to deal with 600,000 contractors when you are already dealing with their clients and the clients already pay all the costs for collecting tax?

IR35 failed so they are attacking us upstream. If the reporting changes go ahead, not only will agents abuse the conduct regs opt out, they will refuse to deal with anyone NOT using an umbrella.

[jmo21]

https://www.gov.uk/government/upload...e_expenses.pdf

Although it's aimed at umbrella companies, this will hit us all if we aren't careful. For example, one potential idea is



So no more travel or subsistence expenses allowed if you are a contractor

Not good news for all of us if this comes to pass.

Could this drive up our rates to compensate, or keep them flat, drive contractors out the market and set up clients to engage larger consultancies more?

It won't affect me that much as I don't the Mon-Fri stay over thing.

[TykeMerc]

https://www.gov.uk/government/upload...e_expenses.pdf

Although it's aimed at umbrella companies, this will hit us all if we aren't careful. For example, one potential idea is



So no more travel or subsistence expenses allowed if you are a contractor

Not good news for all of us if this comes to pass.

Not at all good news for my business, it's over a decade since I last had a client in possible, let alone practical commuting distance apart from work from home stuff.

It becomes even more totally silly when you have intersite travel in there too, if one business can claim it as an expense, but another can't.

Ludicrous situation that can't work for the vast majority of us.

[LisaContractorUmbrella]

I don't think this is bleak as the document seems to show that HMRC is finally recognising the difference between a temp and a contractor - that aside, nothing that comes out of this will come into play until at least 2016 anyway

[Pondlife]

I believe so. It's been / being discussed in the IPSE fora about what the next course of action is - no-one is happy with the published rules, though, apart from HMRC.

Not sure what the next course of action is - if it goes nowhere then possibly a judicial review?

Add it to the manifesto so we get a seat at the table. It's the only way.





Ok, I'll stop trolling now.

[TheFaQQer]

Regarding that, is it a done deal at this point? So from July onwards, agencies will have to report all payments made to those whom they engage.

I believe so. It's been / being discussed in the IPSE fora about what the next course of action is - no-one is happy with the published rules, though, apart from HMRC.

Not sure what the next course of action is - if it goes nowhere then possibly a judicial review?

[Pondlife]

Remember that HMRC said that PSCs would be exempt from the new reporting requirements as well, though.

If only there was such a legal entity as a PSC it would make HMRCs life so much easier.

If only... Hang on, I've got an idea.

[Zero Liability]

Regarding that, is it a done deal at this point? So from July onwards, agencies will have to report all payments made to those whom they engage.

[TheFaQQer]

The subsequent points do suggest that they are aware of the implications thus would have on PSCs. As does the second proposal. So not quite all doom and gloom.

Remember that HMRC said that PSCs would be exempt from the new reporting requirements as well, though.

[Zero Liability]

Got me before I deleted that - I would caveat what I said with the prospect of the FLCs potentially offering more in the way of employment rights, but it's all pie in the sky and seems to reduce contractors to glorified temp workers. All speculative but very bleak.

[TheFaQQer]

Combined with the FLCs (although purely hypothetical at this stage), agency reporting requirements and now these changes for umbrellas, it's as though they're trying to kill off contracting. What they gain in taxes short term will be offset by the diminution of this sector of the market and the attendant loss of productivity and flexibility in the UK's economy. I guess people will still do it for the control and flexibility it offers but with none of the permie benefits on offer and no doubt very similar levels of tax contemplated, will it be seen as worth the effort?

I've only had two contracts that were near home (actually they've both been WFH) - if the travel and subsistence become something that I can no longer claim as a freelancer, that's the end for me. I have no intention of paying my travel to London each week out of my own pocket - it's just not worth my while to do that.

I guess if you are reasonably local to where you tend to work, then it works out - but if not, then anyone who has a reasonable level of expenditure is going to be f**ked completely if this is what they implement.

[Zero Liability]

Yes, leave that for the FLCs and new agency reporting requirements.

[TheCyclingProgrammer]

The subsequent points do suggest that they are aware of the implications thus would have on PSCs. As does the second proposal. So not quite all doom and gloom.

[TheFaQQer]

https://www.gov.uk/government/upload...e_expenses.pdf

Although it's aimed at umbrella companies, this will hit us all if we aren't careful. For example, one potential idea is

One way to achieve this would be to determine that where the individual is supplied through a third party the workplace of the end client would in all cases be a “permanent workplace”. In this case no relief for travel from home to workplace, and associated subsistence, would be available. This would apply whatever the form of the third party.

So no more travel or subsistence expenses allowed if you are a contractor

Not good news for all of us if this comes to pass.