{"content":[{"text":"Technical factsheet: accounting and tax treatment of \n IR 35 deductions","bbox":{"left":0.120748,"top":0.23219,"width":0.590484,"height":0.038312999999999986}},{"text":"in the public sector","bbox":{"left":0.120748,"top":0.280539,"width":0.21518700000000004,"height":0.01847199999999999}},{"text":"Recap of the new rules","bbox":{"left":0.120748,"top":0.319418,"width":0.21955600000000006,"height":0.015923999999999994}},{"text":"From April 2017, where a public sector organisation engages an off-payroll worker","bbox":{"left":0.120748,"top":0.343934,"width":0.7316349999999999,"height":0.015923999999999994}},{"text":"through their own limited company (personal service company or PSC), that","bbox":{"left":0.120748,"top":0.36845,"width":0.675582,"height":0.015923999999999994}},{"text":"organisation (or the recruitment agency through which the worker is engaged) will","bbox":{"left":0.120748,"top":0.392967,"width":0.7260530000000001,"height":0.015923999999999994}},{"text":"become responsible for determining whether the rules should apply, and, if so, for","bbox":{"left":0.120748,"top":0.417483,"width":0.7271730000000001,"height":0.015923999999999994}},{"text":"paying the right tax and national insurance contributions (NICs).","bbox":{"left":0.120748,"top":0.441999,"width":0.5680850000000001,"height":0.015923999999999994}},{"text":"The public sector engager or agency is treated as an employer for the purposes of","bbox":{"left":0.120748,"top":0.478774,"width":0.732808,"height":0.015923999999999994}},{"text":"taxes and class 1 NICs, and so the amount paid to the worker’s intermediary for the","bbox":{"left":0.120748,"top":0.503195,"width":0.743966,"height":0.01592400000000005}},{"text":"worker’s services is deemed to be a payment of employment income or of earnings","bbox":{"left":0.120748,"top":0.527616,"width":0.74051,"height":0.01592400000000005}},{"text":"for class 1 NICs for that worker.","bbox":{"left":0.120748,"top":0.552037,"width":0.282274,"height":0.01592400000000005}},{"text":"The public sector engager or the agency is liable for secondary class 1 NICs and","bbox":{"left":0.120748,"top":0.588812,"width":0.719334,"height":0.01592400000000005}},{"text":"must deduct tax and NICs from the payments they make to the intermediary in","bbox":{"left":0.120748,"top":0.613328,"width":0.696883,"height":0.01592400000000005}},{"text":"respect of the services of the worker. So the PSC will only ever receive net income.","bbox":{"left":0.120748,"top":0.637844,"width":0.741645,"height":0.01592400000000005}},{"text":"The person deemed to be the employer for tax purposes is obliged to remit","bbox":{"left":0.120748,"top":0.674619,"width":0.6666780000000001,"height":0.01592400000000005}},{"text":"payments to HMRC and to send HMRC information about the payments using real-","bbox":{"left":0.120748,"top":0.698992,"width":0.7405480000000001,"height":0.01592400000000005}},{"text":"time information.","bbox":{"left":0.120748,"top":0.723366,"width":0.14898599999999998,"height":0.01592400000000005}},{"text":"Accounting treatment of the income","bbox":{"left":0.120748,"top":0.760141,"width":0.344939,"height":0.01592400000000005}},{"text":"ACCA’s Technical Advisory helpline has had many calls querying the accounting","bbox":{"left":0.120748,"top":0.784704,"width":0.718194,"height":0.01592400000000005}},{"text":"treatment of the transactions under the new rules. There is currently very little","bbox":{"left":0.120748,"top":0.809268,"width":0.690135,"height":0.01592400000000005}},{"text":"guidance available and all the accountancy blogs show a high level of confusion and","bbox":{"left":0.120748,"top":0.833832,"width":0.751949,"height":0.01592400000000005}},{"text":"disagreement among accountants on exactly how to treat the basic double entries.","bbox":{"left":0.120748,"top":0.858396,"width":0.7350420000000001,"height":0.01592400000000005}},{"text":"The main issue is whether or not to show the income in the PSC accounts as net or","bbox":{"left":0.120748,"top":0.882959,"width":0.742831,"height":0.01592400000000005}},{"text":"gross.","bbox":{"left":0.120748,"top":0.907523,"width":0.05488799999999999,"height":0.01592400000000005}},{"text":"1!","bbox":{"left":0.495288,"top":0.933942,"width":0.013462999999999947,"height":0.015660000000000007}}],"images_bbox":[{"left":0.656957,"top":0.095309,"width":0.341094,"height":0.105715}],"images_bbox_not_text_overlap":[{"left":0.656957,"top":0.095309,"width":0.341094,"height":0.105715}]}