Thanks to the new Off-Payroll working rules, often referred to as the New Rules, which have come into effect on and from 6th April 2021, the professional accountants have their tasks cut out. They have the responsibility of guiding their clients to make the most of the new rules. Here is where, probably the advantage of hiring the best accountants in Shinfield or elsewhere from quality accounting firms lies.
Let us in this page discuss the efficacy of these new rules and the role of accountants in this.
What do the new rules mean?
The new pay off working rules are designed to ensure than individual who works as an employee but in his or her own limited company, (general a PCS or Public Service Company) or any other intermediary, has to pay the same Income Tax and the National Insurance Contribution (NIC) as any other employee. However this rule is not applicable for the self-employed individuals. Thus, here is where the professional accountants in Reading as anywhere else need to educate their clients about what they have needful to do and to explain why the rule is applicable, or why it is not.
The needful to be done for the PSC or medium/large scape PCO
While it is the onus of the contractor to provide their services through the PSC on and from 6th April 2021, it is the responsibility of every large or medium sized PCO and voluntary sector organisations, as well as all the other public sector organisations to assess the employment status of the contractor for the purpose of tax payment. Now this is an area of work, which has to be taken care of and addressed by our experts who offer bookkeeping service in Reading or elsewhere.
Now this rule applies to every public sector clients as well as the private sector companies that fulfill the any two or all three following conditions:
- It enjoys an annual turnover of over £10.2 million
- It has a balance sheet total of in over £5.1 million
- It has in excess of 50 employees
The role of the professional accountants in explaining the new rules
Few contractors are still not aware of the IR35 rules, which is essentially the tax avoidance legislation. A recent survey conducted by IR35 has shown that the majority of the in-work contractors (52%) has not yet assessed for the IR35. 86% of the contractors have not yet received important documentation, which is known as KID or Key Information Document. This is where our accountants in Wokingham have to be proactive in getting the KID for their clients and explaining the nitty-gritty of the rules to their clients.
The main objective of these new rules is to define legally the status of a contractor in regards to employment characteristics – and how the contractors are from an actual employee. The rules also ensure that the employees are taxed properly and accurately. This is surely one area that has to be manned by our accountants in Hurst.
Under these circumstances, it is the responsibility of our accountants in Calcot to..
- Take stock of the current workforce
- Discuss to the agencies and individuals in behalf of their clients and share the contact factsheet to help them understand how the new rules will influence them
- Determine whether the Off-Payroll working rules will apply
- Determine who will operate the PAYE (‘Pay As You Earn)
- Settle the disagreements
- Maintain the records
Thus, you see, under the present scenario, professional accountants from quality firms working on the behalf of their clients will make a lot of difference in explaining things. That is the reason, you must put stakes in a quality accountant firm. What better name can you opt for, than Biz Accounting Solutions Ltd? For further details, call us at 01183 671854 or 07877 224964 during our business hours.