Contractors Beware – Pre-budget intelligence
Contractors beware… HMRC is planning to bring forward further guidance when and how IR35 rules will apply to office holders and directors providing their services through limited companies. There is a strong possibility this will be highlighted on Budget day next week. Both Contractors and their accountants are anticipating that Budget paperwork will include the promised clarification for changes in the Finance Bill 2013.
HMRC plans to publish further guidance on the change to IR35, explaining exactly what it means and providing clarity about when it will apply. However some are already warning that the new approach could herald more restrictions on contractors and increased IR35 tax investigations. Draft Finance Bill 2013 clauses, published on 11 December will amend the IR35 rules to clarify that the existing provisions apply to office holders as well as employees.
Mervyn Stanley, Business Development Director FW Accounting commented,
“It is clear that HMRC want to make IR35 more effective in attacking personal service company arrangements and it’s no surprise to see increased activity in this area,”
Follow this blog for a post budget update and our take on how it will affect contractors.