Budget 08: Government targets umbrella companies

Tens of thousands of contractors could be hit for tax on travel expenses
after the government announced it was looking at the relief available to workers
operating in umbrella companies.

Many temporary workers moved into umbrella company structures after the
government effectively killed off managed service companies due to concerns over
tax avoidance.

Anne Redston, visiting professor at Kings College London, said the ‘writing
is on the wall’ for umbrella companies as the government announced in its Budget
notes that it was considering action against the structures.

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