The Tribunal quite clearly got this wrong. There is no way that biscuit is covered in chocolate. However since the Government/HMRC got rid of the Office for Tax Simplification, I think they must have some strange sadistic streak that wants to make everyone's life more difficult. Just put VAT on all biscuits - doesn't bother me because my clients bring a regular supply of biscuits and chocolates to the office anyway!
Our i-Pace is still going strong on its original tyres at 26,000 miles. I reckon they will get to 30,000 without too much trouble. The rear tyres on my V8 on the other hand need changed every 8,000 miles if I am lucky. I am against all further persecution of the motorist or any tracking of my journeys: can't have people knowing I sneaked away for 9 holes!!
My immediate thought when I saw this was that HMRC are looking to see if they can bring some income currently treated as dividends, in to PAYE. They would need to abolish the Directors' exemption from NMW first but it wouldn't surprise me.
HMRC are becoming like the angry wasp in Autumn buzzing about causing everyone grief. It is high time the direction of their travel was changed before they ruin the economy.
As a sole trader (with 10 staff), I got really wound up when I needed to enter my personal details to get an Agent Services Account and every time our authorisation expires (after 18mths?) I have to re-input my personal details into the PC of each of my staff.
I complained to HMRC 3 or 4 years ago and I have complained more recently when the VAT Registrations confirmations for clients were sent to my house.
This is all down to the fact that HMRC appear to believe that a sole trader is just one person working out of the back bedroom of their house when in reality there are many who work from offices and have staff. Whoever was given the specification for writing the software was poorly instructed.
For MTD and Agent's Accounts etc, sole trader agents should be treated as businesses and not individuals.
In the main, when I have to contact HMRC about a Notice of Coding, it's because HMRC have messed it up. e.g. client normally paid £2,400 into his pension but last year had an inheritance and put an additional one off £20K in. HMRC have assumed he will do the same this year and have amended his code to include much higher pension contributions.
Thankfully my client was smart enough to notice and call me.
If HMRC didn't keep messing up the tax codes they wouldn't need to restrict access to the Agent's Line for important things we actually need it for.
If this was a close call i thinkm mr lLneker can count himself a very lucky boy
"Mr Lineker wrote on social media: "I had already paid all tax due at the top rate and happily so. I'm totally flabbergasted as to why I was expected to pay double. Thankfully justice was done.""
Would others agree that his direct quote here is more than slightly misleading to members of the
general public who would view the sum of tax and ni as being the "overall tax" - the reality here appears to be that he has significanly saved on national insurance that he would have paid had this contract been caught by IR35 - presumably there are other peeps who work for the bbc who have been clobbered have paid signficantly more overall tax than Mr Gary. Also why does he think he would be double paying tax ?
At present his reputation probably remains intact - but if there is doubt as to whether he would win an appeal perhaps he is not fully out of the woods. Either way his clever use of the word tax whilst ignoring ni seems to slightly irk me from a tyransparency viewpoint - he didnt have to comment on his taxes but he did !.
I don't think his quote is misleading at all. He will have paid virtually the same NI as anyone else who was employed or self employed earning the same amount of money. The NI that HMRC would like him to have paid was employer's NI which by it's very definition should be paid by employers not employees.
If anyone was due to pay employer's NI it was the BBC.
I was surprised when I saw that HMRC had taken a case against a partnership under IR35 but had they taken an employment v self employment case and won, it would have been the BBC who would have been liable for the tax, NI and penalties. I can't help but think that there is a desire at some high level to avoid the BBC being subject to any public humiliation (although it manages to do that for itself sometimes)
As mentioned earlier I would like to see some cost/benefit analysis of the appeals HMRC funds using our money. In fact I would like to see a proper cost/benefit analysis of the whole IR35 regime. Clients of ours working through PSC's in the public sector getting paid perhaps £80K/£90K are now employed in the public sector, with funded pensions, paid holiday and sick pay on salaries of £120K - £140K doing the same job. Is this net additional cost taken in to account in HMRC's calculations of the benefits of IR35?
Most of our private sector PSC clients were highly specialised experts but due to a blanket approach by the agencies they obtained work from found they couldn't work outside IR35 despite genuinely being outside IR35 - some have taken their skills overseas and others have retired costing the country a huge loss of skills. With dividend tax and higher Corporation Tax Rates is there any positive benefit from IR35? I doubt it.
Once i have finished with all the Tax Returns I will then move on to planning remuneration, bonuses, dividends, gift aid and pension contributions for countless clients who are very keen to avoid the 60% band.
When I explain the 60% band to clients they very often get a bit annoyed and consider it grossly unfair (as do those caught by what should now be called the moderate income child benefit charge). Cliff edge taxes never work and it would have been so much simpler to leave everyone with a personal allowance and just make the higher rate of tax, say 45% from £100K.
Other stupid tax legislation has seen people relocate to England from Scotland to save the 1%, soon to be 2% additional tax and the lower higher rate starting point. As one high earning client told me, the savings paid for his mortgage and he quite liked the drive North for a couple of days a week.
I was pleased to see some of the MTD changes which were announced recently and it will take some of the pressure off small landlords but it is still a huge hammer to crack a very small nut - just move everyone on to making monthly tax payments on account and leave the rest the same: I have had a member of staff spend the last 3 weeks trying to correct and reconcile the absolute mess a client had made of Xero. They know it is going to cost them a fortune and they have conceded they should have let us do it for them but they previously kept perfectly reconciled manual records that were a pleasure to use and used those words "how hard can it be?". The fixation with MTD which (according to HMRC) will reduce costs is just fantasy for so many.
I have spoken to two Consultants in their 50s in the last few days, both of whom are going to retire later this year because they are at the lifetime allowance for pensions and have been paying the pension charge for a few years now - their perspective is that they can't be bothered with the hassle and it is easier just to retire than pay such high tax rates. Apparently the pension charges and the LTA are the main topics of conversation for doctors and consultants at the moment.
There has to be a simple fix to stop these doctors feeling over taxed and under appreciated.
Bad tax legislation always has an equal and opposite reaction!
My answers
The Tribunal quite clearly got this wrong. There is no way that biscuit is covered in chocolate. However since the Government/HMRC got rid of the Office for Tax Simplification, I think they must have some strange sadistic streak that wants to make everyone's life more difficult. Just put VAT on all biscuits - doesn't bother me because my clients bring a regular supply of biscuits and chocolates to the office anyway!
Our i-Pace is still going strong on its original tyres at 26,000 miles. I reckon they will get to 30,000 without too much trouble. The rear tyres on my V8 on the other hand need changed every 8,000 miles if I am lucky. I am against all further persecution of the motorist or any tracking of my journeys: can't have people knowing I sneaked away for 9 holes!!
My immediate thought when I saw this was that HMRC are looking to see if they can bring some income currently treated as dividends, in to PAYE. They would need to abolish the Directors' exemption from NMW first but it wouldn't surprise me.
HMRC are becoming like the angry wasp in Autumn buzzing about causing everyone grief. It is high time the direction of their travel was changed before they ruin the economy.
As a sole trader (with 10 staff), I got really wound up when I needed to enter my personal details to get an Agent Services Account and every time our authorisation expires (after 18mths?) I have to re-input my personal details into the PC of each of my staff.
I complained to HMRC 3 or 4 years ago and I have complained more recently when the VAT Registrations confirmations for clients were sent to my house.
This is all down to the fact that HMRC appear to believe that a sole trader is just one person working out of the back bedroom of their house when in reality there are many who work from offices and have staff. Whoever was given the specification for writing the software was poorly instructed.
For MTD and Agent's Accounts etc, sole trader agents should be treated as businesses and not individuals.
This article has just kindled my first real thought of retirement. There is only so much straw that can be piled on the camel's back.
In the main, when I have to contact HMRC about a Notice of Coding, it's because HMRC have messed it up. e.g. client normally paid £2,400 into his pension but last year had an inheritance and put an additional one off £20K in. HMRC have assumed he will do the same this year and have amended his code to include much higher pension contributions.
Thankfully my client was smart enough to notice and call me.
If HMRC didn't keep messing up the tax codes they wouldn't need to restrict access to the Agent's Line for important things we actually need it for.
I don't think his quote is misleading at all. He will have paid virtually the same NI as anyone else who was employed or self employed earning the same amount of money. The NI that HMRC would like him to have paid was employer's NI which by it's very definition should be paid by employers not employees.
If anyone was due to pay employer's NI it was the BBC.
I was surprised when I saw that HMRC had taken a case against a partnership under IR35 but had they taken an employment v self employment case and won, it would have been the BBC who would have been liable for the tax, NI and penalties. I can't help but think that there is a desire at some high level to avoid the BBC being subject to any public humiliation (although it manages to do that for itself sometimes)
As mentioned earlier I would like to see some cost/benefit analysis of the appeals HMRC funds using our money. In fact I would like to see a proper cost/benefit analysis of the whole IR35 regime. Clients of ours working through PSC's in the public sector getting paid perhaps £80K/£90K are now employed in the public sector, with funded pensions, paid holiday and sick pay on salaries of £120K - £140K doing the same job. Is this net additional cost taken in to account in HMRC's calculations of the benefits of IR35?
Most of our private sector PSC clients were highly specialised experts but due to a blanket approach by the agencies they obtained work from found they couldn't work outside IR35 despite genuinely being outside IR35 - some have taken their skills overseas and others have retired costing the country a huge loss of skills. With dividend tax and higher Corporation Tax Rates is there any positive benefit from IR35? I doubt it.
Once i have finished with all the Tax Returns I will then move on to planning remuneration, bonuses, dividends, gift aid and pension contributions for countless clients who are very keen to avoid the 60% band.
When I explain the 60% band to clients they very often get a bit annoyed and consider it grossly unfair (as do those caught by what should now be called the moderate income child benefit charge). Cliff edge taxes never work and it would have been so much simpler to leave everyone with a personal allowance and just make the higher rate of tax, say 45% from £100K.
Other stupid tax legislation has seen people relocate to England from Scotland to save the 1%, soon to be 2% additional tax and the lower higher rate starting point. As one high earning client told me, the savings paid for his mortgage and he quite liked the drive North for a couple of days a week.
I was pleased to see some of the MTD changes which were announced recently and it will take some of the pressure off small landlords but it is still a huge hammer to crack a very small nut - just move everyone on to making monthly tax payments on account and leave the rest the same: I have had a member of staff spend the last 3 weeks trying to correct and reconcile the absolute mess a client had made of Xero. They know it is going to cost them a fortune and they have conceded they should have let us do it for them but they previously kept perfectly reconciled manual records that were a pleasure to use and used those words "how hard can it be?". The fixation with MTD which (according to HMRC) will reduce costs is just fantasy for so many.
I have spoken to two Consultants in their 50s in the last few days, both of whom are going to retire later this year because they are at the lifetime allowance for pensions and have been paying the pension charge for a few years now - their perspective is that they can't be bothered with the hassle and it is easier just to retire than pay such high tax rates. Apparently the pension charges and the LTA are the main topics of conversation for doctors and consultants at the moment.
There has to be a simple fix to stop these doctors feeling over taxed and under appreciated.
Bad tax legislation always has an equal and opposite reaction!
That's quite right and it is over and above the normal LBTT