"offseting the cost of daily lunch and commute against tax to be closed in Budget"

[BolshieBastard]

Because it's not "fair".

To make it "fair" the "loophole" needs closing - rather than encourage a flexible workforce and extend similar tax relief to temporary workers on FTE and zero-hour PAYE.

As for Ltd's, currently such expenses are deductible before IR35 is applied. Expect that "loophole" to be challenged next if enough jump ship from Umbrella to Ltd.

This.

[LisaContractorUmbrella]

There's not a whole lot that's factually correct in that article:

1. There was a 'discussion' in December which means that, at that point, HMRC had made no decision with regard to tax relief on T&S.
2. There will be a 'consultation' but, as far as I know, no dates are in place so I would be surprised if there is an announcement next month.
3. If anything does happen then changes will not come into force until April 2016
4. Much of the controversy surrounding expenses comes from the companies still operating 'pay day by pay day' schemes whereby low paid individuals 'sacrifice' part of their pay which is then processed as an expense regardless of whether a cost has been incurred. This is very different from professional contractors who have no permanent place of work as they are constantly moving from contract to contract.
5. An over-arching contract is a recognised concept in law that provides continuity of employment for contractors whilst they are working on assignment but also in the gaps between assignments.
6. "Recruitment agencies offer to run umbrella companies for a group of workers in return for a fee" -

[Contreras]

stuff like this i have to wonder why?? are the amounts involved that significant?

feels more like a measure to grind people down than anything

Because it's not "fair".

To make it "fair" the "loophole" needs closing - rather than encourage a flexible workforce and extend similar tax relief to temporary workers on FTE and zero-hour PAYE.

As for Ltd's, currently such expenses are deductible before IR35 is applied. Expect that "loophole" to be challenged next if enough jump ship from Umbrella to Ltd.

[portseven]

stuff like this i have to wonder why?? are the amounts involved that significant?

feels more like a measure to grind people down than anything

[PerfectStorm]

Guess umbrellas are about to become an even worse deal.

[TheCyclingProgrammer]

These things also talk about specific amounts which means they seem to be referring to scale rates which umbrellas have dispensation to use.

[Contreras]

Loophole that lets freelance workers offset the cost of lunch and commute against tax to be closed in Budget | This is Money

Reading this they seem to keep referring to Umbrella's rather than Ltds?

HMRC know this would be difficult to apply to Ltd employees generally.

FLCs however...

[malvolio]

Loophole that lets freelance workers offset the cost of lunch and commute against tax to be closed in Budget | This is Money

Reading this they seem to keep referring to Umbrella's rather than Ltds?

Which is fair enough from their perspective: umbrella users are employees and not in business so why should they get paid business expenses?

And yes, I do know why, but then again I'm not a journalist.

[TechJinx]

Loophole that lets freelance workers offset the cost of lunch and commute against tax to be closed in Budget | This is Money

Reading this they seem to keep referring to Umbrella's rather than Ltds?