Contractor Umbrella Companies
Many contractors use contractor umbrella companies both to avoid IR35 tax and to process their income.
Th e umbrella company is able to offset some expenses against tax for the contractor that they wouldn’t get if they were a permanent employee or paying IR35tax.
However, these expenses, like travel and subsistence, are coming under threat from Conservative Chancellor George Osborne.
Promised to Abolish IR35
The Conservativs came to office with a wink and a nod that they would abolish IR35.
However, all that they actually promised was to ‘look at’ IR35 again.
They kept that promise and did look at IR35 again.
However, it was not the outcome that contractors expected.
The Conservatives decided to keep IR35 and, not only that, they decided to strengthen it.
They have been doing so ever since.[caption id="attachment_878" align="alignnone" width="218"] Contractor Umbrella Companies which avoid IR35 tax[/caption]