The Correspondent

The Accountant

Tax, accountancy and company-structure questions from the contracting front line.

129 ARTICLES
2000–2004
7 DESKS

BEATS · TAX · COMPANY STRUCTURE · SECTION 660 · ACCOUNTANCY

2004

29 DEC 2004Revenue warns composite companies on NIC and travelEarly in December I wrote that the Inland Revenue were about to issue a tax bulletin that would include guidance aimed mainly at contractors working…BUSINESS
25 JUN 2004Government eases tax avoidance disclosure rules for advisersWe reported here on the Government’s detailed plans for its new tax avoidance disclosure regime.BUSINESS
17 JUN 2004Arctic Systems Section 660 case: closing dayThe case of Geoff Jones (GJ) and his wife Diana (DJ) closed at lunch time today after the Revenue's barrister, Rupert Baldry (RB) had spent another…IR35
16 JUN 2004Arctic Systems Section 660 case: second dayThe second day started where the first left off – with barrister Malcolm Gammie (MG) continuing to set out his case for the appellants, Geoff Jones…IR35
15 JUN 2004Arctic Systems Section 660 case: first dayMonday (June 14) saw the start of the key section 660A test case involving the two shareholders in Arctic Systems – Geoff and Diana Jones.IR35
11 JUN 2004Form 42 share disclosure deadline for new companiesThere has been some discussion and concern raised on some other web sites, including among accountants, about the failure of many businesses to…BUSINESS
9 JUN 2004Section 660 Arctic Systems test case backgroundAs UKTECH reported last week the Revenue are using Section 660A to attack a wide range of businesses in the hope of raising an average of around…IR35
7 JUN 2004Flat rate VAT and freelancer VAT issues explainedOver the past few months a number of VAT queries have been raised by UKTECH users.BUSINESS
4 JUN 2004The new agency regulations and limited company opt-outA reader asks: There are now many articles asking specific questions relating to the 'agency regulations' and opt-outs.ASK THE EXPERTS
3 JUN 2004Redrow bricklayers win holiday pay at Appeal CourtIn the summer of 2003 I reported on an Employment Appeal Tribunal decision involving Redrow Homes that ruled that a group of sub-contractor…IR35
26 MAY 2004Contractor loses EAT appeal in HP dismissal caseAt the end of 2002 UKTECH reported on the Employment Appeal Tribunal (EAT) case of John Williams.BUSINESS
19 MAY 2004New disclosure rules for tax avoidance schemesIn the Budget on 17 March the Chancellor of the Exchequer announced rules which introduce a new obligation on promoters and users of certain tax…BUSINESS
14 MAY 2004Corporation tax interest rates rise from 17 MayFollowing the recent rises in the bank rate the Inland Revenue announced new rates of interest for underpaid and overpaid instalment payments of…BUSINESS
13 MAY 2004New anti-avoidance rules on employment-related securitiesWhen you read a new Revenue press release that talks about dealing with "Schemes designed to avoid income tax and National Insurance Contributions"…BUSINESS
4 MAY 2004Revenue adopts risk-based approach to PAYE auditsFollowing a report originally issued by the Revenue at the end of 2001 it appears that their approach to Employer Compliance Reviews (PAYE audits) is…BUSINESS
30 APR 2004How IR35 lets employers avoid employment liabilitiesA few weeks ago, just after the Bill Hood/Usetech case result was announced I sent a letter to Accountancy Age commenting on the Revenue's view of…IR35
29 APR 2004Future On Line loses IR35 case at CommissionersSpecial Commissioner, His Honour Stephen Oliver QC, who was the Commissioner who ruled in favour of the freelancer in the Tilbury Consulting case in…IR35
28 APR 2004Shell to cut UK IT jobs, outsource to IndiaThe problems at international oil giant Shell look set to impact the UK IT market.PRESS
21 APR 2004£17K bad debt defeats an IR35 challengeFreelancer David 'S' had suffered a double blow from contracting and IR35.IR35
20 APR 2004Ansell Computer Services IR35 hearing over substitutionSpecial Commissioner Graham Aaronnson QC ('GA') added his name to the growing list of Special Commissioners who have struggled with the complexity of…IR35
15 APR 2004Qdos IR35 wins show client confirmations workFor freelancers who might have been somewhat depressed by Bill Hood's Usetech Limited result at the Special Commissioners it might help to know that…IR35
13 APR 2004Finance Bill: 19% dividend tax and avoidance disclosureThe Finance Bill 2004 has been issued by the Government – all 574 pages of it!BUSINESS
12 APR 2004Freelancer recovers deemed tax after IR35 victoryI recently reported on the case of Victor and his company Victory Ltd, who won his IR35 case at the General Commissioners.IR35
8 APR 2004Usetech IR35 ruling: further analysis and appeal prospectsMy initial analysis was drafted in some haste on Monday.IR35
6 APR 2004Usetech loses IR35 case before Special CommissionerSpecial Commissioner Colin Bishopp has delivered another blow to the ailing design engineering freelancer Bill Hood, when he found that Hood's…IR35
30 MAR 2004Money laundering rules sow mistrust between clients and advisersAs I reported back in October 2003 new regulations - The Money Laundering Regulations 2003 - have been introduced.BUSINESS
29 MAR 2004How to pay dividends before 31 March 2004It is clear that the key question arising from the budget on 17 March is the new 19% tax charge on dividends.BUSINESS
18 MAR 2004An alternative perspective on Budget 2004I’m sure that, like me, many freelancers subscribed to various newsletters from accountants and web sites for news about the budget.POLITICS
17 MAR 2004IR35 survives the 2004 BudgetAs predicted on UKTECH, today’s Budget does not mean the end of IR35 or the need for products like Freelancers Outside IR35 to help freelancers deal…POLITICS
17 MAR 2004First-year allowances extended, IT 100% relief endsThe Chancellor has announced that the 50 per cent first year allowance on fixed assets for small companies will continue for another year from 1…POLITICS
17 MAR 2004Inland Revenue and Customs to merge, shedding jobsReaders will doubtless be sorry to learn that up to 14,000 Inland Revenue and Customs and Excise staff will lose their jobs when the Inland Revenue…POLITICS
16 MAR 2004How long are you at risk from a Revenue challenge?Recent events such as the announcement of IR591 seem to have created a surge in the number of queries I get about the risks of an Inland Revenue…BUSINESS
10 MAR 2004Court of Appeal rules on Dacas agency caseIn a decision that has just been published on the Court service web site, the Court of Appeal has overturned an Employment Appeal Tribunal decision…BUSINESS
3 MAR 2004Revenue's revised Section 660A guidance in Bulletin 69Back in December 2003 we noted that the Inland Revenue were in the process of producing additional guidance on Section 660A to augment the guidance…IR35
24 FEB 2004Contractor wins IR35 appeal representing himselfAs a professional IR35 expert I would never advise a freelancer to handle his or her own IR35 case in front of the Commissioners.IR35
23 FEB 2004Arctic Systems Section 660A case delayed to springThose of you who have been following the Arctic Systems case, which is likely to be the first Section 660A test case before the Special…IR35
16 FEB 2004Revenue stays tight-lipped on IR591 plansThe Revenue met last week with representatives of various professional bodies, such as the Chartered Institute of Taxation and the Institute of…IR35
13 FEB 2004Ten hours a week defines active involvementThe Government has introduced legislation to address tax avoidance schemes which exploit relief for trading losses through partnerships.IR35
11 FEB 2004Revenue builds Employment Status Indicator toolWe have had several reports recently that the Inland Revenue were in the process of developing an ‘intelligent’ tax status software system that would…BUSINESS
21 JAN 2004Contractor beats IR35 without substitution rightThe right of substitution is often seen as the holy-grail in the fight against IR35.IR35
20 JAN 2004IR591 update: will IR35 be abolished?There have been further unconfirmed rumours that IR35 will be withdrawn in April 2004 to be replaced by whatever IR591 will bring.IR35
16 JAN 2004Employment Agency Regulations and the limited-company opt-outIn December we reported that The Conduct of Employment Agencies and Employment Businesses Regulations 2003 had finally been enacted after passing…BUSINESS

2003

22 DEC 2003Why IR591 may not end IR35Following the pre budget report announcement (paragraph 5.91) that next spring’s budget will see new measures brought forward “to ensure that the…IR35
16 DEC 2003IR591: what the next budget may bringWhat can we expect from the "son of IR35 out of Section 660A" otherwise paragraph 5.91 of the Treasury release on 'Delivering a modern and fair tax…IR35
10 DEC 2003What the Pre-Budget Report means for freelancersNo doubt tomorrow the newspapers will be full of the details of the pre budget report that the Chancellor delivered today.POLITICS
5 DEC 2003Revenue's revised Section 660A guidance concedes littleThe Revenue has just released revised guidance on its approach to Section 660A the anti avoidance legislation on settlements.IR35
5 DEC 2003Revenue revises its Section 660A guidance on settlements and dividendsNew guidance follows tax bulletin 64 and the Arctic Systems case, in which a company owned 50:50 by a married couple was assessed for over 40K going…IR35
25 NOV 2003100,000 financial services jobs predicted to move overseasThe Times reports today that a UK financial services consultancy, Troika, has predicted that 100,000 UK financial services jobs in banking and…BUSINESS
18 NOV 2003Tax bodies renew Section 660A challengeBack in September we saw seven professional bodies join together in an unprecedented move to flag their deep concerns about the way in which the…IR35
17 NOV 2003Tilbury IR35 decision published and analysedAs I reported here: Tilbury decision analysis The Tilbury Consulting IR35 appeal was successful at the Special Commissioners.IR35
13 NOV 2003Court ruling highlights public liability insurance riskA recent Court of Appeal decision in the case of Bottomley v Secretary and members of the Todmorden Cricket Club and Others (7 November 2003) serves…BUSINESS
7 NOV 2003Revenue rejects professional bodies on Section 660AOn 11 September I reported that, in an unprecedented move, seven leading professional bodies had written jointly to the Inland Revenue to express…IR35
4 NOV 2003What the Tilbury IR35 victory really meansAs we announced last night Roger Tilbury and Tilbury Consulting Limited have won their case against Margaret Gittins (Her Majesty's Inspector of…IR35
3 NOV 2003Tilbury wins IR35 appeal against the RevenueUKTECH has just heard that Roger Tilbury and his company Tilbury Consulting have won their appeal at the Special Commissioners against the Revenue…IR35
3 NOV 2003Treasury delays new money laundering regulationsOn 31 October the Treasury announced a last minute delay in the introduction of new money laundering regulations.BUSINESS
30 OCT 2003New money laundering rules could sour adviser relationsAccountants are covered by two pieces of legislation being brought into force in 2003, the Proceeds of Crime Act 2002 and the Money Laundering…BUSINESS
27 OCT 2003Home-working freelancers win business rates reprieveA case brought by one of the Revenue's own employees, appears to have reprieved many freelancers who work from home and were being threatened by the…BUSINESS
16 OCT 2003Tilbury IR35 hearing: day two at the Special CommissionersThis appeal before the Special Commissioners in London started on Tuesday 14 October.IR35
14 OCT 2003Tilbury IR35 hearing: day one at the Special CommissionersToday, 14 October, in London, another freelancer took his IR35 case before the Special Commissioners and came face to face with Death!IR35
29 SEP 2003Special Commissioners grant witness summons in IR35 appealIn July Special Commissioner Dr Nuala Brice, sitting at a preliminary appeal hearing, heard an application on behalf of a Revenue inspector Margaret…IR35
26 SEP 2003EU savings directive targets undeclared overseas incomeThe Government is required to implement the European Directive on the taxation of savings by January 2005.BUSINESS
11 SEP 2003Professional bodies challenge Revenue's Section 660A viewSix professional bodies including the English and Scottish institutes of Chartered Accountants, the Chartered Institute of Taxation and the Chartered…IR35
11 SEP 2003Revenue changes law on reclaiming overpaid taxThe Inland Revenue has put in place new legislation to protect themselves against the potential effects of a recent judgement in a case that the…POLITICS
4 SEP 2003Another IR35 victory over the RevenueLawspeed have helped another freelancer to beat off a Revenue challenge to his IR35 status.IR35
2 SEP 2003VAT amnesty: one month left to registerHM Customs and Excise have issued a reminder that there is just one month left in their amnesty for late registration.BUSINESS
19 AUG 2003Accountants' special interest group reaches 100 membersI am pleased to announce that the UKTECH accountants’ special interest group for accountants has just admitted its 100th new member approximately 6…BUSINESS
18 AUG 2003Corporation tax consultation offers little for freelancersThe Inland Revenue has published a corporation tax consultation paper, which sets out new proposals to "take forward the Government's reform of…BUSINESS
13 AUG 2003Rent-a-chair hairdressers win VAT status appealThis is not an example of a VAT man succumbing to the attractions of a quick shampoo and a blow dry!BUSINESS
11 AUG 2003Internet advance-fee scams and how to report themI am sure that many readers will have come across the typical internet scams that seem to come mainly from individuals based in Africa and seem to…BUSINESS
8 AUG 2003Are Revenue officers trained to judge IR35?Employer compliance reviews – often known as PAYE audits – are the routine checks by the Revenue to ensure compliance with the legislation regarding…BUSINESS
1 AUG 2003UKTECH's 2004 Budget tax proposals to CBIThe CBI is conducting its annual exercise of seeking comments on technical tax issues they consider should be addressed at the next Budget.POLITICS
23 JUL 2003'Worker' status and holiday pay for subcontractorsIncreasingly Employment Appeal Tribunals are having to deal with the conundrum, ‘can a person be self employed and perhaps in business on their own…BUSINESS
14 JUL 2003IR35 extended to cover domestic workersThe passing of the 2003 Finance Bill into legislation on 10 July 2003 sees the first extension of the IR35 provisions since IR35 came into force in…IR35
9 JUL 2003Agency temp Dillon ruled an employee of agencyIn March we reported that an Employment Appeal Tribunal had found an agency worker to be an employee of the agency.IR35
2 JUL 2003Special Commissioners' guidance on IR35 appealsThe Special Commissioners recently placed guidance on their web site about IR35 appeals.IR35
2 JUL 2003Customs offers VAT late-registration penalty amnestyIn a surprising move for what is generally regarded as a hard nosed organisation HM Customs and Excise has just announced a moratorium on late…BUSINESS
1 JUL 2003New NIC status rules for entertainers and performers...IR35
1 JUL 2003Revenue closes Eversden inheritance tax spouse loopholeThe Government has taken action to close what they regarded as an inheritance tax loophole.POLITICS
10 JUN 2003Section 660A's threat to freelancer family businessesI am setting out below the submission I have made to the All Party Small Business Group consultation on freelancers regarding Section 660 Section…IR35
10 JUN 2003IR35's damaging impact on knowledge-based freelancersHere is the text of the submission I have made to the All Party Small Business Group consultation on freelancing.IR35
4 JUN 2003Employment lawyers spread FUD over IR35 contractsSeveral web sites (such as silicon.com and znet.co.uk) reported recently that lawyers Tarlo Lyons were warning about the risks of criminal…BUSINESS
3 JUN 2003Tribunal slates composite umbrella company as tax deviceA UKTECH reader has brought a recent Employment Tribunal decision to our attention.BUSINESS
2 JUN 2003Structuring a long contract in Saudi ArabiaNote: the original user wished for this question to be posted anonymously.ASK THE EXPERTS
12 MAY 2003Section 660A now targeting celebrities and groupsThe Section 660A debate continues to widen with The Times reporting that celebrities and TV stars are also being targeted under Section 660A and…IR35
12 MAY 2003Getting round a badly-worded restriction clauseI have been asked to post this query by a freelancer who wishes to remain anonymous.ASK THE EXPERTS
3 MAY 2003Beware quick-fix IR35 avoidance productsAn article in The Times money section today 3 May, issues a timely warning against products that promise protection against IR35.IR35
9 APR 2003Budget 2003: the impact for freelancersThe Chancellor rose at 12.30 to present his first pre-lunch Budget speech.POLITICS
8 APR 2003Section 660 guidance as tough as fearedUnofficial word has come back to UKTECH that the Revenue's new approach to Section 660 - the married couple's business tax - might be as bad as was…IR35
8 APR 2003Tax law re-write leaves IR35 scope unchangedIn this article, 'Possible increase in Scope of IR35' (March 19, 2003) we commented on a claim that the current tax law re-write appeared to widen…IR35
6 APR 20032003 Budget preview: National Insurance risesIt is clear that Chancellor, Gordon Brown will need to raise more from the coming Budget than he probably expected a few months ago.BUSINESS
4 APR 2003Do my contract clauses keep me outside IR35?A reader asks: I (the Worker) am working through my Limited Co.ASK THE EXPERTS
28 MAR 2003Analysis of the Synaptek IR35 decisionMr Justice Hart delivered his judgement at 10am this morning.IR35
26 MAR 2003Synaptek IR35 judgement due 28 MarchWe have just heard from Mr Justice Hart's clerk that he will be handing down his judgement in the Synaptek/Stutchbury case on Friday 28 March at 10am…IR35
19 MAR 2003Tax Law Rewrite may widen IR35 scopeIt appears that the Revenue may have taken advantage of the Tax Law re-write to increase the scope of IR35.IR35
17 MAR 2003Agency temp ruled employee: Dacas v Brook StreetThe same judge who presided over the original judicial review into IR35 - has handed down a second land-mark decision.BUSINESS
14 MAR 2003Awaiting the Synaptek IR35 judgementI've spoken with Mr Justice Hart's clerk who confirms that he has not yet written up his judgement and because he is busy on another case, he will…IR35
12 MAR 2003Revenue's Section 660 attack on married couplesThe Revenue’s attack on married couples has now hit the headlines although it has been brewing for some time now.IR35
28 FEB 2003Synaptek IR35 appeal: day two court reportConrad McDonnell (CM) counsel for Gordon Stutchbury (GS) spent another 90 minutes finishing his case this morning before the Revenue’s counsel Clive…IR35
4 FEB 2003Filetravel Limited personal service company accountantsAccountants providing individual service company for contractors.BUSINESS
2 JAN 2003Safe Solutions umbrella and composite companiesOperates composite companies "We create composite limited companies for six or more individuals, whose sole purpose is to provide a structure for the…BUSINESS

2002

16 DEC 2002Gabem Group composite company for contractorsProvides composite companies Claims "The Gabem Group provides a personalised accounting and administration service that enables temporary workers to…BUSINESS
12 DEC 2002Nash-Williams Management composite company profiledAppears to offer composite company arrangements Claims, "Nash-Williams Management can enable you to significantly increase your net earnings in…BUSINESS
11 DEC 2002John Williams loses employment appeal against Hewlett PackardThe EAT case of Mr J M Williams -v- (1) Hewlett Packard (2) Certes Computing Ltd - Wednesday 11 December.IR35
10 DEC 2002Williams v Hewlett Packard: critical EAT status caseUKTECH reviews an important Employment Appeal Tribunal Case which is soon to come to Court - Mr J M Williams -v- (1) Hewlett Packard (2) Certes…IR35
5 DEC 2002Clear Sky Contracting umbrella company for contractorsUmbrella company run by firm of accountants ITAccounting Online Limited Claims "Clear Sky Contracting has been designed by ITAccounting for the…BUSINESS
4 DEC 2002Umbrella and composite company database: an updateUKTECH has established a central database of companies offering umbrella or composite companies or any form of IR35 solution.BUSINESS
3 DEC 2002Drole Computer Services umbrella company profiledEstablished in 1984 operating umbrella company services.BUSINESS
27 NOV 2002The Contractor Company: Isle of Man umbrella profiledIsle of Man based company which appears to offer an umbrella company service through a company called the Contractor Company.BUSINESS
27 NOV 2002CIS reform revives original IR35-style proposalsAmongst the PBR press releases is one that reveals that the Government is seeking views on a series of new proposals to reform the CIS.POLITICS
20 NOV 2002Paycheck Services composite company profiledOffers a composite company Claims "If you are currently contracting on a PAYE basis joining Paycheck Services can increase your take-home pay, as you…BUSINESS
18 NOV 2002Parasol IT umbrella company profiledParasol apparently provides an umbrella company facility to consultants working in the IT industry.BUSINESS
18 NOV 2002Consulting Overseas: IR35 scheme for expat contractorsNo details of whether they operate as an umbrella or composite.BUSINESS
18 NOV 2002Brookson composite company scheme profiledBrooksons operates by "grouping contractors into composite limited companies" Claims "Independent contractors can pay less tax without facing the…BUSINESS
15 NOV 2002Joint Venture Management umbrella company EBT schemePart of the Castlemain Group offering an umbrella company with various benefits including an EBT.BUSINESS
11 NOV 2002CFP/Dignatio creditors meeting reveals huge tax claimThis morning (November 11, 2002), UKTECH's tax expert, Kevin Miller attended the creditors meeting to hear at first hand what the position was.BUSINESS
5 NOV 2002Help for contractors hit by CFP/Dignatio collapseUKTECH reported last week that the umbrella company Contractor Financial Planning Limited (previously known as Dignatio Limited) had ceased trading…BULLETIN

2001

25 JUN 2001IFS seminar on employed versus self-employed statusEmployed or self employed?IR35
23 MAY 2001Clients still need contractors despite IR35I suspect these reports are overstated.ASK THE EXPERTS
23 MAY 2001Website venture: in business on my own account?A reader asks: As well as being my original contract company, since Dec 1999 my limited company has also been used for my own successful website…ASK THE EXPERTS
23 MAY 2001Applying mutuality of obligation to IR35Not surprised that we find it difficult to apply MOO - so do the Revenue.ASK THE EXPERTS
22 MAY 2001IR35 status cases the Revenue left outThe Inland Revenue have just added the missing section of their Employment Status Manuals to their website - section 7000 on Case Law.ASK THE EXPERTS
2 MAY 2001Drafting a direct contract to avoid IR35Alan You should always seek professional help in drawing up such a contract.ASK THE EXPERTS
2 APR 2001What the IR35 judicial review judgement meansMr Justice Burton delivered his judgement in the PCG Judicial Review of the IR 35 legislation today.ASK THE EXPERTS
30 MAR 2001Court of Appeal ruling on the control testA case reported in the Times on 22 March seems to add another possible twist to the complex legal issue of when is a worker an employee.ASK THE EXPERTS
15 FEB 2001Can you reclaim IR35 tax if struck down?When you say pay “our IR 35 tax” I assume you mean pay the PAYE and NIC on the possible deemed payment?ASK THE EXPERTS
15 FEB 2001IR35 penalties and the Revenue's contract reviewsThere is little new in this statement.ASK THE EXPERTS

2000

13 NOV 2000Inside the Revenue's Employment Status ManualThe Inland Revenue recently published the bulk of its internal manuals on its website.BULLETIN
11 NOV 2000How a flat-rate VAT scheme would workIn this week's pre budget report it has been proposed that small businesses with a turnover of less than £100,000 might have a flat rate of VAT.ASK THE EXPERTS
4 AUG 2000Agency workers ruled employees of their clientMany contractors have reported instances of clients and agencies refusing to countenance any changes to their standard agency contract terms, even…AGENCIES