Precise look at the recent changes to UK tax legislation and how it directly affects our freelancers.
Let’s take a closer look at what the recent changes to UK tax laws means for our freelancers. Adam Sumner, Precise Consultants’ co-founder, is a chartered accountant who is fully abreast of all the developments and gave us this insight to the structural changes in the HMRC approach:
“Essentially the purpose of any new legislation is to help the UK Government streamline tax collection processes, and of course generate more revenue from the UK taxable population and National Insurance contributors.
“This new legislation gives wide ranging powers to UK tax authorities in respect of holding agencies liable for any UK tax payable by the freelancers they deploy. In the absence of an agency discharging their liability, tax authorities will move the burden on from the errant agency towards the next liable body in the chain ie the agency’s client. For any company based abroad, tax recovery efforts will focus on any company with UK associations in that chain.
“We are now seeing large licensees of oilfields such as Shell and BP sending questionnaires to clients that are designed to assess the tax liability of the entities and individuals they work with. This is aimed at determining that tax liability is being discharged correctly and by the correct entities.
“Although the early stages of 2015 have seen a light touch applied to enforcement of the new rules, it is important for businesses and individuals alike to know that with Precise Consultants, they have an agency which has the know-how to protect them from costly errors in regards to tax and tax liability. The UK government will no doubt audit client and agencies alike as they look to increase their revenue streams and enforce the new legislation.”