Responding to HMRC’s consultation Off-payroll working: calculation of PAYE liability in cases of non-compliance, the CIOT suggests that a set-off approach would be much fairer than the current position, where HMRC notifies the worker of any status change and the worker then has to amend their tax return to claim back any overpayment.
This consultation was about setting off taxes already paid by a worker or intermediary against tax due from a deemed employer, where a worker has been mis-categorised as falling outside, rather than within, the off-payroll working rules. This is of particular importance given that in many cases it is now the end client which determines whether or not the rules apply. The main problem around changes in categorisation is that the worker may already have paid tax and NIC on the income in question, in the belief they were outside the rules.
Early confirmation of whatever approach is to be taken would provide certainty for business, particularly in relation to open cases where HMRC may provisionally agree settlements based on the new rules, notes the CIOT.
Responding to HMRC’s consultation Off-payroll working: calculation of PAYE liability in cases of non-compliance, the CIOT suggests that a set-off approach would be much fairer than the current position, where HMRC notifies the worker of any status change and the worker then has to amend their tax return to claim back any overpayment.
This consultation was about setting off taxes already paid by a worker or intermediary against tax due from a deemed employer, where a worker has been mis-categorised as falling outside, rather than within, the off-payroll working rules. This is of particular importance given that in many cases it is now the end client which determines whether or not the rules apply. The main problem around changes in categorisation is that the worker may already have paid tax and NIC on the income in question, in the belief they were outside the rules.
Early confirmation of whatever approach is to be taken would provide certainty for business, particularly in relation to open cases where HMRC may provisionally agree settlements based on the new rules, notes the CIOT.
