Jane Stevens of Jenrick IT is closely monitoring the EU led legislation known as the Agency Workers Directive. This Directive was implemented via the Agency Workers Regulations (AWR) and is due to impact UK businesses hiring temporary workers at the beginning of October 2011.

Jane has been following proceedings as guidance unfolds from the Department for Business, Innovation and Skills (BIS) - this guidance is still being assessed and deliberated. Whilst this is happening, Jane is liaising with various umbrella companies, accountants and legal entities to assess their interpretation of how both clients and contractors could be impacted going forward.

Below is a summary from Marc Morris of 1st Option (APSCo accredited Accountants) regarding developments as they stand at the moment, 27 April 2011.

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With 2011 being ‘pitched’ as the year of recovery for the contracting market; 1^st time contractors and, perhaps even, more experienced contractors need to be aware of the potential pitfalls of using third parties to manage their payroll. Legislation changes for EBTs (Hotlink to previous article) and now news of 2 umbrella companies going into liquidation emphasise the need to take good advice.

The recent high profile bankruptcy of two ‘umbrella’ companies highlights the importance of recruiters and contractors undertaking better due diligence of service providers before engaging their services, says giant group, the contractor services provider. (more…)

Jenrick CPI has reason to believe that part of the government strategy to revive it’s coffers for 2010 will be to re-visit IR35. HMRC will be keen to find a route to maximise return to the Treasury in light of the announcement by the government of major cuts in public expenciture.

This was backed up by a recent interview with a tax inspector…….

IR35 is likely to be high on HMRC’s agenda this autumn as, following a lull of 18 months, limited company contractors will once more be in the firing line, warns former HMRC manager and IR35 expert Kate Cottrell of Bauer & Cottrell. (more…)

Disputes between contractors, clients, agencies and umbrella companies are growing in number and becoming increasingly intense, as each player in the contract food-chain tries to hold on to cash as the recession bottoms out.

According to a report in Contracting Matters, disputes between umbrella-contractors and their clients and agencies have risen four-fold on last year’s figures. And Rob Crossland, Managing Director of professional business services provider Parasol, says the effects are wide ranging. (more…)

The Revenue has kept its word of tackling abuse of expenses in umbrella companies by withdrawing the allowance for staff who stay overnight with friends or family.

In their latest online briefing , officials at the UK tax office said their review of the Friends and Family Allowance found it had “no legal basis for giving tax relief.” (more…)