Just thought I would provide you with a copy of the response I got from HMRC with regards to a contractor who is caught by IR35 and working via an umbrella. We know that there are some companies saying they can probably still claim expenses, well this is what HMRC had to say...
QUOTE: “I think it most likely that someone would be subject to SDC if they are deemed to be within IR35 or the new Chapter 10 for off-payrolling in the public sector. I suppose that it is possible, that this is not the case, but highly unlikely.”
So there it is in a nutshell... our advice is that you try to ascertain your SDC status direct with HMRC (job spec and contract of employment), if they confirm to you in writing that you are not deemed under SDC, then these MUST be processed via self-assessment at the end of the financial year. Umbrella companies should have been processing expenses for tax relief purposes via salary sacrifice before April 2016, the law then changed which prohibits us processing via Salary Sacrifice at source for any contractor.
HTH
