CHRISTA ACKROYD LOSES IR35 APPEAL
Former BBC presenter Christa Ackroyd has
lost her appeal against a ruling that she was an employee, not a freelance
contractor, when she worked for the BBC via a personal service company.
The IR35 rules in broad terms mean that
those working via a personal service company have to consider whether, if the
services were provided by the individual contractor directly to the client,
there would be a contract of employment.
Judges in the Upper Tier Tribunal upheld
last year's First Tier Tribunal ruling that she was a BBC employee when she
presented Look North in Yorkshire and was therefore liable to pay income tax
and national insurance contributions.
The case related to the tax years 2006/07
to 2012/13, while she worked for the public broadcaster through her personal
service company, Christa Ackroyd Media (CAM).
HMRC argued that she owed almost £420,000
in income tax and national insurance contributions, before corporation tax
deductions. An HMRC spokesperson said they welcomed the judgment that the
presenter was within the intermediary rules.
'Employment
status is never a matter of choice; it is always dictated by the facts and when
the wrong tax is being paid, we put things right.
It is
right that an individual who works through a company, but would have been an
employee if they were taken on directly, pays broadly the same amount of tax
and national insurance contributions as employees.'
The IR35 rules were amended for Public
Bodies (including the BBC) from April 2017 and the government will make similar
changes for the private sector from April 2020.
Internet links: ICAEW news BAILII
cases
HMRC says it is clamping down on the
promoters and enablers of tax avoidance schemes in the wake of the loan charge
controversy.
Penny Ciniewicz, Director General of
Customer Compliance at HMRC, told the Treasury Select Committee that HMRC is
'doubling the resources' to tackle those in the 'avoidance supply chain'.
In response to questions about the loan
charge, Ms Ciniewicz said:
'We
have more than 100 current investigations into promoters [and enablers], and
we're keeping a very close eye on the market for avoidance. We are spotting
schemes as they emerge and we're tackling them.'
The loan charge policy is currently subject
to an independent review. It came into effect on 6 April this year, and applies
to anyone who used 'disguised remuneration' schemes. The legislation added a
45% non-refundable charge on all loans advanced through the schemes, unless the
individual had agreed with HMRC to settle their tax affairs.
Internet link: ICAEW news
The government has abandoned its planned
increase in probate fees. The increase in fees was originally expected to take
effect from 1 April 2019. However, in March 2019 HMRC postponed the
introduction of the increase, attributing the delay to pressure on
Parliamentary time.
As part of the government's plans, estates
that are valued between £50,000 and £300,000 would have been subject to a
probate fee of £250. Fees were to rise thereafter to reach £6,000 for estates
with a value above £2 million.
Currently, for estates valued at over
£5,000, a grant application made by a solicitor is subject to a flat fee of
£155. A grant application made by an individual is subject to a fee of £215.
The increase was included in a statutory
instrument (SI) however the SI fell away on the prorogation of Parliament in
September, but was reinstated when the prorogation was declared illegal.
The government has now announced that the
planned increase will not take place. Instead there will be a review of court
costs and how they can be covered by the actual service required.
Probate fees apply in in England and Wales.
Internet link: ICAEW post
According to a report published by the
Charity Commision, the majority of UK charities admit fraud is a major risk,
but are still failing to carry out basic tasks in order to protect themselves.
More than 3,300 charities took part in the
Charity Commission's survey into fraud awareness, resilience and cyber security
in the sector. Over two thirds of charities agree that fraud is a significant
risk. Insider fraud is recognised as one of the biggest threats, the report
stated.
The survey found that 85% of charities
think they are doing everything they can to prevent fraud, but almost half do
not have robust protections in place.
The Commission recommended some simple
steps that charities could take to protect their funds, including introducing
and enforcing basic financial controls. They should also make sure no single
individual has oversight or control of financial arrangements, as effective
segregation of duties is a crucial method of preventing and detecting fraud.
The Commission also recommends that
employees, volunteers and trustees should be encouraged to speak out when they
see something they feel uncomfortable about.
Internet link: GOV.UK news
HMRC has published the October 2019 issue
of the Employer Bulletin which contains guidance on a number of issues relevant
for employers. Topics in this edition include:
•
Changes for UK employers
sending workers to the EU, the EEA or Switzerland
•
PAYE Settlement Agreements and
Welsh rate of Income Tax
•
Guidance for employers on
reporting PAYE information in real time when payments are made early at
Christmas
•
Disguised Remuneration
•
Termination payments: Post
Employment Notice Pay for employees paid by equal monthly instalments
•
Do your employees have the
right tax code?
•
Employment Allowance reform – eligibility
rules for the Employment Allowance are changing from April 2020
•
Do you claim the Apprenticeship
Levy Allowance or Employment Allowance?
•
Changes to company car tax
regime
•
Student and Postgraduate Loans
•
Childcare vouchers
•
Trivial Benefits in kind
•
Paying for fitness equipment
If you would like help with payroll matters
please contact us.
Internet link: GOV.UK employer-bulletin-october-2019
With less than 100 days until the self
assessment tax return deadline of 31 January 2020, HMRC is urging taxpayers to
complete their tax returns early, in order to avoid the last minute rush.
HMRC report that last year more than 2,000
people submitted their tax returns on Christmas Day. Taxpayers should consider
submitting their returns early to avoid the stress of a last minute rush.
Angela MacDonald, HMRC's Director General
for Customer Services, said:
'The
deadline for completing Self Assessment tax returns is only 100 days away, yet,
so many of us wait until January to start the process. Avoid the last minute
rush by completing your tax returns on time and then enjoy the upcoming festive
period.
We
want to help people get their tax returns right – starting the process early
and giving yourself time to gather all the information you need will help avoid
that stressful, late rush to file.'
Not all taxpayers need to complete a tax
return as tax is automatically deducted from the majority of UK taxpayers'
wages, pensions or savings. For people or businesses where tax is not
automatically deducted, or when they may have earned additional untaxed income,
they are required to complete a Self Assessment tax return each year.
HMRC is also reminding people who are
liable for the High Income Child Benefit Charge that they may need to file a
tax return before the deadline. Those with income over £50,000 who receive
child benefit, or those whose partner gets it, are liable for the charge.
Taxpayers can check their annual income via their P60 or Personal Tax Account,
and use HMRC's child benefit tax calculator.
The deadline for filing paper tax returns
was 31 October 2019 and the deadline for online tax returns and paying any tax
owed is 31 January 2020. If taxpayers miss the deadline, they face a minimum
£100 penalty for late submission.
Contact us for help with your self
assessment tax return.
Internet link: GOV.UK news
HMRC has updated their guidance on how to
recognise when contact from HMRC is genuine and how to recognise phishing or
bogus emails and text messages.
Internet link: GOV.UK recognising phishing emails
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