LONG-SERVING public officials are cutting their tax bills by being paid through their own companies.
A leaked review initiated by chief secretary to the Treasury Danny Alexander has found that 2,000 senior officials are paid through their own company structures, rather than taxed directly through PAYE.
Of those, 800 have worked for their department for more than two years. A further 400 have worked for more than a year.
The Treasury wants longer term ‘off payroll' contracts earning more than £220 a day to prove they are paying full income tax and NI, reports Press Association.
Departments that fail to better manage the contracts will face sanctions of up to five times the contract paid.
Just how are "employees" getting round the provisions of IR35 and what are HMRC doing about it?
Posted by: Jeremy, 03 May 2012 | 11:31
I cannot believe how these "arrangements" were signed off by someone in authority and allowed to happen in first place. This shows yet again the unreal world that public sector employees and indeed management live in. I just wonder if the Treasury gave the nod to some of the more senior positions in the first instance and are now backpeddling to avoid further embarassment
Posted by: Don Freeman, 03 May 2012 | 13:43
how can they cut their tax bills since they then fall under IR35 with tax deducted at source before they net their fat cat salaries
Posted by: faro, 03 May 2012 | 14:04
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