Orange Genie News

If you’ve recently been researching umbrella companies online, you could be forgiven for feeling a little alarmed. Between ill-informed or self-interested news articles claiming all umbrellas are pirates, parasites or con-artists, and the outlandish promises in the “paid ad” section at the top of your Google search results, it could be tempting to simply turn and run from the circling fins. But before you rush out and buy a bigger boat, we’d like to assure you that these waters are not nearly as deadly as they may at first appear.

In the wake of the recent reform of off payroll working in the Public sector, many contractors have suddenly found themselves assessed as working inside IR35. Sound advice has led many of these contractors to cease operating through their own limited company, and opt instead for umbrella employment. For a contractor working inside IR35 this is usually the better choice, but it is a very different way of working. Below you’ll find our plain language guide to what you can expect following your switch to umbrella employment.

Good contractor accountants can be difficult to find. From our position as contractor specialists it’s often frightening to see the kind of advice contractors are given by accountants in general practice. For example, we interviewed a lady who’d been advising locum doctors about the Public sector IR35 changes. When asked what her firm had done she replied,

                “Nothing, they’re all outside the changes as they all have contracts in different hospitals with different NHS Trusts, so more than one engager.”

It is bad enough that HMRC’s own inability to programme their own systems to deal with their own rule change mean that we and our Contactor clients are hugely inconvenienced needing to file the majority of Contractors Self Assessments for 2016/17 on paper rather than electronically: but now we know even their own staff don’t appreciate the magnitude of the issue and its impact.

In the last 48 hours we have interacted with different HMRC departments and offices and have evidence that this is a shambolic mess!

April 28th saw the launch of the government’s new Tax- free Childcare scheme. First announced in 2013, the scheme provides working parents with much needed help paying for childcare. Supported by National Savings and Investments the scheme is open to everyone and does not rely on your employer choosing to offer a Childcare Voucher scheme.

The current/old scheme

Basic-rate taxpayers are able to claim up to £243 worth of vouchers every month. Higher and additional-rate taxpayers can take less (£124 and £97 respectively).

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