Written on 23-May-2019
Are you currently working as a self-employed Chef and benefiting from a higher pay rate than most agencies or the jobs you see advertised online?
It might seem like a quick win from the outset, but be careful as you may end up paying for it later.
The new IR35 legislation for the private sector comes into play in April 2020 and HMRC are clamping down on income tax and National Insurance contributions, so you need to ensure that the correct deductions are being made against your earnings.
In simple terms, if you are working at a site through a limited company, agency or an umbrella company and you look like an employee for tax purposes, your assignment would be seen as being ‘inside IR35’ which means your pay would be subject to PAYE and taxable deductions.
If these payments are not being deducted at source for you and or you’re not declaring them through your year end tax returns, it’s not the agency that will have the tax man come knocking.
HMRC will expect the deductions which should have been made, to be declared by you.
Don’t let the illusion of higher pay rates lead you into to a false sense of security as it could mean you could end up with a huge tax bill at the end of the year.
Always choose to work with a reputable agency that takes compliance seriously, crossing all the i’s and dotting all the t’s so you can sleep easy after all your hard work!