T&S Legislation – Important information for Umbrella contractors!

In line with our commitment to keep contractors informed on all important issues, please see the information below regarding new HMRC rules that will apply to Travel & Subsistence (T&S) claims, effective 06 April 2016.

The new T&S rules mean that contractors (who use an intermediary such as an Umbrella company) must now go through a test to determine the level of Supervision, Direction and/or Control (SDC) they are under while working on a particular assignment. Contractors who pass the test will still be able to obtain tax relief on their T&S, but those who fail will no longer be able to do so.

There is also a change as to how tax relief is claimed after 06 April. Instead of the current practice where relief is obtained at source (i.e. every week/month), it can now only be claimed on an annual basis via the submission of a personal tax return.

Oyster’s preferred Umbrella provider, Champion Contractors, can be contacted on 0161 703 2549 if you require further details about the new SDC process.

Oyster are confident that the vast majority of our contractors who work through Umbrella companies will not fail an SDC test, it is however a process that you must undertake.

At this point in time, it may also be prudent for you to consider the option of working via your own limited company after 06 April. The benefits and financial opportunities are considerable, and, crucially, the new T&S rules will not apply to the vast majority of contractors who operate on this basis.

For more immediate information about your options, please contact Champion Contractors on 0161 703 2549 or info@championcontractors.co.uk.