The extension of the “off-payroll” working rules to the private sector mentioned in our previous article is planned for April 2020 but in the meantime, tax tribunal decisions are still being decided against HMRC.
In a recent case involving a radio presenter working for TalkSport, it was decided that the presenter would not have been an employee if directly engaged. A key factor was that the level of control over the presenter fell far below the sufficient degree required to demonstrate a contract of service.
The accountancy bodies have been lobbying the Government to take the decision of the judges in this and the recent case involving Lorraine Kelly into consideration when they update the CEST software used to determine employment status.
Disguised remuneration loan charge review
The Chancellor, Sajid Javid has commissioned a review of the Loan Charge. The review will see if the policy is an appropriate way of dealing with disguised remuneration loan schemes used by individuals who entered directly into these schemes to avoid paying tax.
The disguised remuneration Loan Charge was introduced to tackle contrived schemes where a person’s income was paid as a loan which did not have to be repaid instead of receiving a salary, thereby avoiding tax and national insurance. Such schemes have now been successfully challenged by HMRC in the courts.
Disguised remuneration loan schemes were used by tens of thousands of people. This has raised concerns about the use of the Loan Charge as a way of drawing a line under these schemes and collecting tax from the beneficiaries. The Government is clear the schemes do not work and are unfair to 99.8% of taxpayers who have not used them.
October 3rd, 2019