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Umbrella companies are only part of the IR35 problem

136946
Only part of the problem

Key points

  • Changes are expected to curtail the non-compliance in the umbrella company market.
  • These measures may not stop other problems that arise with off-payroll working.
  • Some of the tools used to determine a worker’s status do not take account of recent court decisions.
  • Many people and advisers still do not understand how the IR35 legislation operates.

The government consultation issued on 6 June 2023 entitled ‘Tackling non-compliance in the umbrella company market’ is now closed and I suspect we will see some tax changes in this area announced in the autumn statement to be made in November 2023.

It is expected the tax changes to be announced will be aimed at curtailing the abuse by some umbrella companies by the placing of more responsibilities on agencies that generally supply workers to umbrella companies. Those powers are rumoured to include the requirement for the agency who placed the specific...

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