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New HMRC Penalties for Contractors from 01st April 2009

For all tax returns submitted after 01st April 2009, under new legislation (Schedule 36 of the Finance Act 2008), HMR&C will be able to impose financial penalties on any contractors who do not take reasonable care in assessing their contract and working arrangements in respect to IR35.

Don’t run the risk; use ContractorUmbrella to avoid any possibility of such problems! ContractorUmbrella process your payments through PAYE and will ensure that you pay the correct tax and NI contributions from the outset.

As an example, a contractor sources his first contract as a help-desk assistant. His contractor colleagues advise him that paying himself a small salary and drawing the remaining income as dividends, through his own Limited Company is the most tax efficient way to be paid. Happy with this advice; it is exactly what he does, without having a professional review carried out on his contract to determine his IR35 status.

As a result, he underpays his tax contributions by £10,000 throughout the course of the financial year. Under the new legislation, HMR&C have the power to recover the underpayment of £10,000, impose a penalty of 100% of the deficit and charge interest.

This potentially leaves the contractor in question owing £20,800 in penalties and interest to HMRC.

If you fall inside of IR35 or are unsure of your IR35 status, use ContractorUmbrella to ensure that you do not fall foul of the new government legislation. Your income is processed through PAYE and therefore the IR35 rules will not apply to you. Rest easy at night without the worry of a big tax bill and fine!

ContractorUmbrella also provides a professional IR35 review service for contractors. If it is found that you fall inside of IR35 and as a result register, the review charge is waived.

If you would like to make an enquiry about our services, please do not hesitate to contact a member of our team on 01206 713680 or email us at info@contractorumbrella.com.

You may also find the following pages and guides useful:

Umbrella Company myths and facts revealed.
FREE downloadable Contractor guide
Contractor Guide to IR35
New and updated Expenses Guide
If you would like to appoint ContractorUmbrella click here.

Read what our clients have to say about us.

We are totally committed to customer service and are the only company of its type to offer a full money backed service guarantee.

Why Choose ContractorUmbrella?

ContractorUmbrella is the hassle-free, straight talking umbrella company that provides umbrella employment for UK based contractors and freelancers. Independently voted as the best umbrella company by the readers of Contractor UK.

As one of the most trusted umbrella companies in the UK, we guarantee our employees peace of mind, absolute compliance and complete security. We are one of the longest standing and most respected umbrella companies in the UK.

Benefits of working through ContractorUmbrella;

  • Fast and easy registration-  be ready to work in 24 hours, simply register online and we’ll take care of the rest.
  • Calculate your take home pay- use our online calculator to find out how much you could be taking home through ContractorUmbrella.
  • Same day payments- we offer same day payments as standard, for no additional fee.
  • Our Commitment Charter- is our guarantee that you will be looked after at every step of the way.
  • Flexible Limited Company accountancy- when you sign up to our sister company Dolan Accountancy, you can transfer to ContractorUmbrella when umbrella employment better suits or your assignment sits inside IR35.
  • Employee Benefits- at ContractorUmbrella there are many benefits available to you as our employee including Childcare Vouchers, our Employee Rewards Scheme, Group Pension Scheme, Foreign Currency Exchange, Contractor Accommodation, Contractor Mortgages and much more.
  • Personal Employee Liaison Officer- we believe in the personal touch, so you will have your very own dedicated Employee Liaison Officer during your employment with us. Read some of the glowing testimonials we've received about our lovely staff and the outstanding commitment they give to all our employees and clients.

If you’d like to find out more, call us on 01206 591 000 or request a call back by completing our online form.