Connecting to LinkedIn...

Blank

Increased use of travel and subsistence schemes

Increased use of travel and subsistence schemes
The Emergency Budget will lead to a greater use of travel and subsistence schemes  as a means of increasing temporary workers take-home pay and avoiding employers National Insurance Contributions, according to Simon Kite, a Partner at top 20 accountancy firm and recruitment sector specialist Saffery Champness.
"By creating overarching employment contracts, these schemes allow workers to claim travel and subsistence costs in respect of workplaces that may previously have been regarded as permanent, such claims not being allowable except for temporary workplaces," says Mr Kite.
He continues: "the Budget will leave most workers with less disposable income. Pay reviews have not kept up with inflation and the 1% increase in employees National Insurance Contributions, which comes into effect next April, will have a direct impact on wage packets. Accordingly, schemes such as those offered by umbrella companies, which offer higher levels of net pay, will be more appealing than ever."
The Government has consulted on travel and subsistence dispensations and on how national minimum wage legislation should be applied in relation to these schemes.
"These schemes look likely to be with us for a while and, whilst HM Revenue & Customs still need to deal with non-compliant offenders, recruitment businesses and umbrella companies that operate robust compliance procedures should expect to take advantage of the tax savings that exist for both the agency and the worker," concludes Mr Kite.

Tags:

Articles similar to

Articles similar to