It's set be 'all change' for many* Personal Service Company (PSC) owners next April, when the new private sector off-payroll working tax rules replace IR35. Those affected will find that their company fees will be paid to them after deduction of PAYE tax and National Insurance by their 'payer'.
These are 7 vital things that all PSCs owners should definitely not ignore.
1. Have you checked your employment status using HMRC's CEST (Check employment status tool) to see whether you are within IR35 for your existing contract for the 2019/20 year?
2. Have you reviewed the travel rules to ensure that you have claimed what is permitted, depending which rules apply?
3. Will you fall into the new Off-payroll working rules from 6 April 2020? Have you considered whether your end client is large or medium sized: is your client on it?
4. If you are going to fall into the new off-payroll working rules next year: does this mean that you should review the case for making an IR35 tax disclosure for the current or earlier years?
5. If you are within off-payroll working for next year: will you still need your PSC?
6. If you are keeping PSC how are you going to draw down profits: will the existence of a money box company be sensible when it comes to Inheritance Tax planning?
7. if you are liquidating your PSC: have you reviewed the Targetted Anti-avoidance Rule (TAAR)?
*170,000 individuals: the number indicated by HMRC as being affected according to their Tax Information Notice on Offpayroll working in the private sector.
And the time before that: