HMRC is facing some serious questions about the advice its call centres are providing to contractors.
PRISM, a trade body and association of umbrella companies, has highlighted around a dozen cases of workers being provided with erroneous advice around expenses, in particular travel and subsistence.
A report from Recruiter has shed light on what PRISM has found so far. With some confusion around the rights of public sector contractors due to the controversial reforms, HMRC should be in a position to offer clear support to workers affected.
It seems however this is not proving to be the case. PRISM CEO Crawford Temple has spoken of his concern and his feeling that this latest fiasco simply adds to the unenviable state HMRC has got itself into around contracting of late.
“This is more evidence, if any were needed, that the whole system of tax and employment legislation is too complicated for people to understand,” Temple told Recruiter. “If those within HMRC are giving the wrong advice because it is not clear, what chance does a contractor have who just wants to carry out sensible financial planning and get on with the job?”
PRISM is concerned enough by the situation to support an independent review of tax and employment legislation, working alongside the Social Market Foundation. The results of this are eagerly anticipated and expected to emerge soon.
HMRC has responded to PRISM’s claims, with a spokesperson saying: "Rules for travel and subsistence expenses for workers engaged through employment intermediaries were introduced from 6 April 2016. The rules put people who work through intermediaries such as agencies and ‘own companies’ in the same position as other employees. Our frontline staff have guidance about the changes."
Whether this ‘guidance’ is having the desired effect however appears to be somewhat debatable.
Contractors should take the advice of trusted specialists, so if you have any concerns or questions regarding IR35 and your contracting status, contact Larsen Howie ASAP.