20th August 2010

Transition to contractor work ''must be registered with HMRC''

HMRC must be notified when contractors transition from full-time work HMRC must be notified when a full-time worker moves to contracting for their former employer.

Full time workers who take on contractor work with a former employer must ensure they register as such with HM Revenue and Customs (HMRC), which could lead them to consider working with an umbrella contractor.

Martin Hesketh, managing director of accountancy Brookson, emphasised the importance of getting a contract put in place for each project or body of work that is undertaken, Contractor UK has reported.

He said it is important to avoid having a single contract covering all of the work which is being undertaken and also emphasised the benefits that negotiating fixed fees for each of these can provide.

"Ensuring that you can distinguish the way you work to that of the employees employed directly with your client will also help you avoid liability under IR35," he explained.

Earlier this month, Qdos Consulting Limited freelancer services manager Seb Maley told ContractorUK.com that it is important that any reforms made to IR35 legislation make it easier and clearer whether or not a given work arrangement will be held to fall under these rules.ADNFCR-3595-ID-800034025-ADNFCR

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