overpayment, there are also significant effects on payroll teams in terms of rectifying the problem and ensuring everything is dealt with in line with legislation.
CIPP comment
The CIPP offers a half-day training course surrounding the issue of overpayments. The agenda includes identifying common causes of overpayments and looks at the complexities surrounding whether there is a right to reclaim erroneous payments. The next course takes place in Manchester on 19 November 2019.
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HMRC loses IR35 case against Richard Alcock 5 November 2019
The Financial Adviser has confirmed that HMRC has lost its case regarding IR35 against Richard Alcock.
HMRC concluded that Alcock was liable for £243,000 in tax as it claimed that he held employment status with Accenture and the Department for Work and Pensions (DWP) when he provided services to them. He was paid as a consultant via his company, RALC Consulting, and asserts that there was no mutuality of obligation between himself and his end clients. The Check Employment Status for Tax (CEST) tool provided by HMRC to establish whether a worker should be classed as employed or self-employed doesn’t include any questions relating to mutuality of obligation. HMRC’s rationale behind this is that all contracts have mutuality of obligation otherwise no contract would exist in the first place. This stance has been heavily criticised by a variety of organisations, including the CIPP, because they argue that the CEST tool is not completely aligned with case law and is therefore redundant. Alcock’s representatives argued that there was no minimum obligation for the end clients to provide work and that any work to be done was agreed, completed and only that work was paid for with no guarantee of continued, future work. He could therefore not be classed as an employee but would be categorised as a contractor and as a result, is not liable for the tax figures proposed by HMRC. There has been a flurry of cases surrounding IR35 in recent times, some which rule in the favour of contractors, and others which HMRC has won. The upcoming reforms to IR35, to be introduced in April 2020, shift responsibility from contractors to determine their employment status to the engager, who will now need to determine whether someone is deemed as falling ‘inside IR35’ or not. This practice is already in force within the public sector but is being rolled out to any private sector organisations that are not deemed ‘small’.
CIPP comment
The CIPP is running a webinar in relation to the reforms around off-payroll working, which can be accessed here. The webinar runs twice a month and will help delegates to ensure that they are complying with the new obligations that will soon be in place. As this is such a hot topic, the CIPP also offers a classroom learning based half day course – Off-payroll working and other employment status considerations. This looks at off-payroll working in further detail, discusses the importance of determining employment status and gives an overview of modern working practices. The next course will be held on 11 December 2019 in Manchester and can be booked here.
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The Chartered Institute of Payroll Professionals
Payroll: need to know
cipp.org.uk
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