Not the GREATEST DAY to SHINE for Gary Barlow

Once again a high profile celebrity hits the headlines with tax avoidance. There is nothing wrong with tax avoidance, it’s tax evasion that is criminal, however in today’s world morality also plays a part and now it seems aggressive tax avoidance is becoming equally as bad as evasion.

So should poor Gary give up his OBE? I personally don’t think so. Unfortunately as we all know there is a fine line and often grey area of tax legislation and advisors all have their opinion of this. Gary would have paid for advice around the scheme he “invested” in and even if it was to save tax you can’t blame him.

The whole issue is that HMRC stance has become more aggressive also and the argument of “this is not what the legislation was intended to do” is simply no help for the tax payer when these schemes are marketed by professionally qualified people who have interpreted the legislation differently to the original purpose. For many years this has been an unofficial battle between accountants and HMRC officers and now it seems the end is in sight, with HMRC looking to name and shame advisors are HM Government winning the tax battle at last?

Time will tell where this will end but one thing is clear, if it is too good to be true, think twice.

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On shore intermediaries legislation

Well following on from my past blog in relation to false self-employment, it seems that I was right and HMRC pushed through the legislation with very little change.

So since 6th April, agencies are now responsible for the employment status of their contract workforce. Thanks very much say the agencies!  But how can they be sure that the workers are paying the correct tax?

All this uncertainty means that now more than ever you need to know your supply chain and ensure that you are comfortable with their processes.

Whilst a welcome change was a deferment of reporting on this to HMRC, they have very cleverly kept the go live as 6th April 2014.  Whilst penalties within the first year will be limited I am sure HMRC will be looking for best practice methods on this.

My advice:

  • Use PAYE umbrellas or PSC only.
  • Get confirmation that PAYE has been reported to HMRC

This way, you don’t need to worry about “control & supervision”

Good luck!

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