Changes to Travel and Subsistence

The government will introduce legislation in the Finance Bill 2016 under S339A ITEPA 2003, to restrict tax relief for home to work travel and subsistence expenses for works engaged through an employment intermediary. This will mean the rules are the same as for employees.

The changes take effect from 6th April 2016 and restrict the claiming of taxable reliefs on benefits claimed through PAYE known as Salary Sacrifice arrangements, which is the way we claim your tax relief through the Hamilton Bradbury Umbrella.

Generally, employees cannot claim relief on their regular commute from home to work and back, the introduction of legislation is to ensure that only eligible workers can claim this relief.

The S339A legislation is also known as IR35 and has broad scope. As a worker who is an employee of an Umbrella Company you are not caught by IR35 because the employment is taxable under PAYE however, the new rules SDC have to be applied when expenses are claimed.

Treasury stands up for the Umbrella

During Monday’s parliamentary questions there was a written question of Conservative MP to Aberconwy Guto Bebb  “what steps his Department is taking to stop agencies using umbrella companies to manage the payroll function of companies within the construction industry” The question fro Guto Bebb some after the Welsh Assembly stepped in and banned contractors working on […]

Guide to Choosing an Umbrella Company

Right now, you’ll discover Umbrella Business promoting as much as 85 % retention of your earnings. That sounds pretty good however not when you understand what’s really going on. The method they do this is by motivating you to claim un-receipted costs or automatically including an un-receipted meal allowance of up to £36 daily.

Myths and Misunderstandings Surrounding Umbrella Companies.

Regardless of the fact that working via an umbrella business is now an accepted and popular practice among contractors, there are still many individuals out there in the contracting/freelancing community and beyond who do not understand exactly what umbrella businesses are and how they work– or the benefits they can bring. Indeed many contractors still swelling umbrella companies along with Managed Service Companies and other intermediaries as part of the group that frequently gets its’ collar felt by the guys at HMRC. In truth, as we shall see, the reverse is real and umbrella companies are quick ending up being the default and most protected method for service providers to manage their profits. This post will certainly look at a few of these misunderstandings and misconceptions and discuss why it is that umbrella business have actually ended up being so popular:

Managing the Finances

If you are contracting in the UK, you could be dealing with two different monetary situations.

Working via a Limited company: You will certainly be paying yourself a monthly salary.
Inside IR35: If within IR35, you just need to pay yourself a deemed salary.

Operating PAYE means that you won’t need to fret about earnings tax and NI contributions. These deductions will certainly be instantly made as soon as your accounting professional processes your payroll.

Claiming expenditures is easy when you are resolving a limited company. You can assert all overhead simply like any other business, consisting of company equipment, training, and other expenses. On the other hand, contractors inside IR35 will only be able to assert a 5 % allowance in lieu of overhead.


Has The Limited Company Had Its Day?

For several years now the first choice a contracting had to make when going into the contracting sector on their own was to choose which type of tax cehicle was the most suitable for their purposes. And typically most service providers inevitably chose the Limited route. However, as we will see, the ongoing intro of ever more limiting tax legislation relating to professionals has made the choice less and less clear cut and in reality, made the umbrella business more favorable with each new law. And with the arrival of the much-despised IR35 regulation (and more recently the new Onshore and Offshore employment policies) the umbrella business has swiftly becoming the tax setup for many contractors. That stated, the field is still quite uniformly split and new specialists pertaining to the sector attempting to decide whether they need to go Limited or work via an umbrella are still dealing with a challenging call. This post will attempt to clear some of the choices involved and ask whether, due to all the new guidelines, the Limited Business is still worth it?

Why use Umbrella Companies

Why use Umbrella Companies

Regardless of having actually been around for years, umbrella business are still the only video game in town when it concerns rock-solid, HMRC friendly tax options for professionals. Along the method umbrella companies have seen off Managed Service Companies, Offshore Solutions, EBT and numerous other Solutions. When it concerns cutting out admin and paperwork and increasing take home pay, umbrella companies are still where it’s at!

How to move from a Limited Company to Umbrella

If you’re thinking about moving from a limited company to an umbrella company then it’s probably safe to assume you’ve been contracting for some time and have an idea of the advantages that switching to an umbrella offers. Here at Hamilton Bradbury we’ve found that most of the contractors who come to us from limited […]


Background On 8 March 2001 the European Court of Justice (ECJ) provided a ruling in the Hoechst and Metallgesellschaft cases (joined cases C-397/ 98 Metallgesellschaft Limited and Others v CIR and HM Chief law officer and C-410/ 98 Hoechst AG and Hoechst UK v CIR and HM Attorney general of the united states). The complaintants, […]