Contractors argue umbrella companies need improved regulation, not outright ban theregister.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from theregister.com Daily Mail and Mail on Sunday newspapers.
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UK government proposals to create a workers watchdog have been slammed by campaigners for not adequately covering umbrella companies, some of which have been accused of sharp practices as the IR35 off-payroll tax revamp expands their usage among contractors.
This week the Department for Business, Energy and Industrial Strategy said it would launch a new organisation to tackle modern slavery, enforce the minimum wage and protect agency workers, work currently spread across three different regulatory bodies.
The single enforcement unit will take a “one-stop shop” approach to improve administration through better co-ordination and pooling intelligence, according to a BEIS statement.
UK gov finally proposes to police rogue umbrella companies but leaves questions unanswered theregister.com - get the latest breaking news, showbiz & celebrity photos, sport news & rumours, viral videos and top stories from theregister.com Daily Mail and Mail on Sunday newspapers.
MPs ignore calls for regulation to help contractors
Lindsay Clark Tue 25 May 2021 // 14:30 UTC Share
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MPs in the UK’s Parliament decided not to select amendments to the 2021 Finance Bill designed to offer contractors protection from rogue umbrella companies accused of skimming off pay and holding back holiday pay.
Last week Conservative MPs David Davis, Sir Iain Duncan Smith, and Andrew Rosindell proposed changes to the UK s 2021 Finance Bill urging the government to introduce legislation to clamp down on intermediary employment firms, which campaigners say have mushroomed as temp agencies and end-user businesses avoid directly hiring contractors judged to fall within the IR35 off-payroll working tax law, introduced this year.
IR35 is a tax reform that was unveiled in 1999 by the UK tax authorities.
The reforms are part of the government s crackdown on so-called disguised employment, where workers behave as employees but avoid paying regular income tax and national income contributions by billing for their services through personal service companies (PSCs), which are taxed at lower corporate rates.
The latest regulation change will force businesses in the UK to set the tax status of their contractors and freelancers. Previously this was set by the contractors themselves. This has already been the case in the public sector for years. The change that happened in April means the rules now apply to medium and large firms in the private sector too.