In his Autumn Statement speech, the Chancellor announced a number of new measures which may result in further action being taken against unethical umbrella providers in 2015. Industry figures give their reaction. What did the Chancellor say about umbrella companies? In the tax-avoidance part of the speech itself, George Osborne said that the Government was consulting on measures “including the use of so called ‘umbrella companies’ to deprive people of basic employment rights like the minimum wage and avoid tax.”
In the official documentation, further action is also planned to tackle the use of ‘overarching contracts’ by some umbrella schemes to further exploit expenses rules: 2.147 Overarching contracts of employment and temporary workers The government will review the increasing use of overarching contracts of employment by employment intermediaries such as ‘umbrella companies’.
These arrangements enable workers to obtain tax relief for home to work travel that would not ordinarily be available. The government will publish a discussion paper shortly to inform possible action at Budget 2015.
So, what does this mean for the umbrella company industry? Lisa Keeble, Co-Founder of All Umbrella Companies Are Equal, comments at http://www.itcontracting.com/umbrella-company-autumn-statement/