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12 Aug 2011
LETTERS sent by the Taxman as part of its campaign to target private tutors could burden educational establishments, a tax protection firm has claimed.
The HM Revenue & Customs' letters have been sent to language schools, distance learning companies and other colleges. They call on the organisations to provide the Taxman with details of "gross payments made for teaching, lecturing, tutoring, examining and invigilating, from which no PAYE tax has been deducted, for the years ended 5 April 2009, 2010 and 2011."
Further reading
The colleges are asked to provide the name of the person, their address, the total amount paid and whether or not it included VAT and a description of the services provided by the individual. This will only apply to individuals who had been paid more than £1,000 in a tax year.
Guy Smith, senior tax consultant at Abbey Tax, said that this could potentially burden larger groups. "One of the companies that received letters has 150 colleges, so it is an awful lot of information they have to provide," he said. "For the distance learning colleges, it will take some effort."
There is also a concern that HMRC will use the information it gathers to scrutinise the employment status of the individuals, which will affect the companies themselves, added Smith.
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Visitor comments Add your comment
Non Story : More reprinting Press releases
Sorry Accountancy Age but your journalistic standards are really slipping.
Did you actually CHECK this story with any of the colleges, or just take the puff from Abbey Tax at face value?
ALL responsible colleges have been taking full UTR details as part of their lecturer contracts for yonks.
If HMRC had a better relationship with agents, they could have saved themselves the postage too.
Posted by: Eleanor, 12 Aug 2011 | 22:23
Misunderstood
Hi Eleanor
I provided Jaimie with a copy of one of the standard letters issued by HMRC, asking for details of the gross payments made etc., with the name of the educational establishment blanked out for confidentiality reasons.
We are not talking about employees here, but rather the freelance individuals to whom gross payments were made.
As I expect you are aware, HMRC is about to launch its PT&C Campaign this autumn and is busy collecting information in preparation.
The link below should take you to an article featured on the Abbey Tax website, which provides more details:
http://www.abbeytax.co.uk/News/LatestNews/Documents/Homework%20for%20HMRC.pdf
I hope the article provides you with some useful background information and puts the topic into context for you.
Posted by: Guy, 19 Aug 2011 | 15:56
old news
I was co-operating with HMRC back in the mid-1990s when at an inner-London FE college. We had plenty of visiting lecturers (freelance) who wanted to avoid tax and NI and I suspect that too much leeway had been given by heads of dept - until I made myself unpopular.
Posted by: mike, 25 Aug 2011 | 12:35