 |
Parasol PAYE umbrella company
Over 32,000 satisfied contractors. Get paid quicker. Call 0800 5836000. |
Income Shifting Legislation - CIOT has grave concerns
Posted Dec 6, 2007
Following the release of draft legislation today which outlines the Governments plans on 'income splitting', the Chartered Institute of Taxation (CIOT) says it has "grave concerns" about the implications of the proposed legislation.
The CIOT says that it has long been of the view that fundamental reform to the structure of small business taxation is necessary if small businesses are to be able to plan their tax affairs with any degree of certainty.
However, the CIOT believes that "it as wholly wrong for the government to deal with this one issue in isolation."
The Government wants to prevent business owners from sharing their income with other family members in order to reduce shared tax bills. The new legislation is aimed at ensuring that family members receive a realistic 'market rate' for any income they receive from small businesses.
Andrew Hubbard, CIOT Vice-President said:
"The legislation imposes an arm's length test and requires taxpayers to work out how much income they have 'foregone' by making a comparison with how the business would have operated had everything been done by independent third parties operating on a fully commercial basis. In theory this might seem fair, but the reality is that family businesses do not and cannot possibly operate on a fully arm's length basis. One spouse might be the main income generator but he/she may well be totally unable to run the business without the full support of their spouse. Measured purely in hours that spouse's input may not appear to be significant, but that is not the reality of the situation. The support of the spouse may well be the difference between the business succeeding and failing."
Contractor Services
- Professional Indemnity Insurance - Essential cover from Hiscox
- The fair umbrella company - take home more pay with paraplus
- InTouch Contractor Accounting - specialist online service & great advice
- Parasol - the UK's favourite umbrella company
- Contract Experts - ClearSky Accounting on 08000 325 326
- Helix Management Ltd - Up to 90% retention. Same day payments.
- Umbrella Company - 12,000 contractors can't be wrong!
- Together we're stronger! - Join PCG, representing contractors
- Cloud 9 Group - Umbrella Solutions only £27.50 per week
- Qdos - IR35 experts - Providers of low cost contractor insurance
- K & B Accountancy Group - Fixed fee contractor accounting only £75pm
- Free IR35 & Tax Review - Call ICS on 0800 195 3750
- Contractor Mortgages - the best deals, based on your contract rate alone!
Related Articles
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
