Schedule 1 to the Finance Bill 2017, confirms the new provisions for off-payroll working in the public sector (applying IR35), will take effect from 6 April 2017. This will affect a huge number of workers, particularly doctors working as locums, nurses, teachers and other consultants.
News & Updates
HMRC has a number of legacy computer systems, which don’t always talk to each other effectively. This has caused problems with class 2 NIC liabilities disappearing from taxpayers’ records, as we reported in our newsletter on 8 December 2016.
Since we last wrote about the VAT flat rate scheme (FRS), the rules have been amended to make it even more difficult for traders to avoid the 16.5% flat rate. To fall outside that category the trader must spend 2% or more of his gross turnover and at least £250 per quarter on “relevant goods”.
Chancellor Hammond made two key announcements regarding MTD; the exemption threshold will be fixed at turnover of £10,000, and businesses with trading income under the VAT threshold won’t have to commence MTD reporting until 2019. All other MTD proposals remain as stated in the Government response to the consultations on 31 January 2017.
For the last 17 years, individuals who provide their own services through an intermediary, and the businesses who engage them, have struggled with the intermediaries legislation known as IR35. The key issue is how to determine whether a particular engagement is within the IR35 rules.
The headlines after the Budget were captured by the 2% rise in the main rate of class 4 NIC. This caused such a fuss as it appeared to break a Conservative Party manifesto pledge not to raise the rate of income tax, national insurance or VAT in this Parliament, i.e. before May 2020.