Tell HMRC how you feel about contractors’ expenses
With most of the recent news focussing on the leaders’ debates, the release of the election manifestos and the promises being made to try and appeal to the various groups of voters, most people will be wondering which party best represents their interests. However, there are organisations which are campaigning to ensure that contractors and other independent professionals get a fair deal no matter which party, or parties, end up in government.
All Umbrella Companies Are Equal, an organisation designed to provide contractors and recruiters with information and advice on how to ensure that they comply with HM Revenue and Customs’ regulations, are keen to ensure that the contractors who might be affected by any changes have their say. AUCAE are asking contractors working through either umbrella or limited companies to share their views on the proposed ban on tax relief on expenses for contractors.
The 2015 Budget revealed plans which could have a significant impact on those who could be described as working under the supervision, direction and control of an end client, and this has been a source of major concern for those who might be affected. This has prompted AUCAE to seek the input of those who might choose to limit the type of contract they would take to avoid finding themselves out of pocket in order to provide some feedback on the plans to HMRC. They intend to anonymise the comments they collect and send them to the department as part of their own response to the taxman’s proposal which is due to take effect from April 2016.
The plans will mean that contractors who work in roles which fit the criteria of being under ‘supervision, direction and control’ of the end client will be unable to claim tax relief on the costs they incur for travel and subsistence during the course of a project. HMRC claim that this will net their coffers by £635 million over the next four years, saying that those who will be targeted will be those who ‘broadly look like an employee’.
Many individual umbrella companies will be providing written responses to the government’s plans to try and convey the potential seriousness of the impact that such a change could have, but AUCAE are keen to hear directly from contractors to lend weight to their arguments. They believe that HMRC will benefit from hearing directly from those who will be affected, especially given the vital role played by contractors in the UK’s economy. Contractors who wish to have their say can complete the form on the AUCAE’s website to have their comments reviewed for the organisation’s submission.
If you are a contractor and you want to understand more about this issue, then our guide to contractors’ expenses could help you to get your head around what can and cannot be claimed. We also have plenty of other resources available to ensure that you feel confident about your decisions, such as a handy comparison of the advantages and disadvantages of a limited company. For more advice on all things financial, our friendly team of experts are always on hand, so give us a call today on 01442 275789 or email firstname.lastname@example.org.