The Autumn Statement announced the end of Travel and Subsistence claims for contractors operating through an umbrella company. Contractors operating through a limited company (Outside IR35) will be unaffected by the removal in April 2016 of Travel and Subsistence
These new rules will only apply to workers who are under the direct supervision direction and control (SDC) of their end-client, or are working inside IR35. HMRC are due to release further clarification on how SDC is assessed in the coming months.
Many contractors will be worse off and it could be time to consider an alternative payroll solution like setting up a PSC. By operating through your own limited company, you will be able to continue claiming Travel and Subsistence expenses combined with other tax efficient methods to maximise your take home pay.
However, even without getting tax relief on travel and subsistence expenses, there are benefits of continuing to work through an umbrella:-
- Continuous employment – helps with mortgage or loan applications and only having your pension building up in one place.
- Statutory benefits – access to SMP and SSP.
- Online and Mobile access – process timesheets and view payslips.
- Mobile app – access holiday, view payment details or check payments.
- Employee rewards schemes
- Insurance benefits
- Independent Financial Advisor access
- IR35 advice
Howett Thorpe will be working closely with the REC and our Professional Passport and FCSA accredited Umbrella partners over the coming months to ensure the very best value and service to our temporary workers. For further advice on how the legislation will affect you please call your local Howett Thorpe office.