Has Liverpool City Region Combined Authority been paying the right amount of income tax and national insurance on payments to personal service companies?
Has Liverpool City Region Combined Authority been paying the right amount of income tax and national insurance on payments to personal service companies?
This is a rather complicated story involving the Liverpool City Region Combined Authority (LCRCA) and one of its contractors called Green Blue Skies Limited that I will do my best to explain as well as I can.
Earlier this week following a request for information to the Liverpool City Region Combined Authority I received a copy of an invoice dated 30th June 2017 from Green Blue Skies Limited for £2,400 for consultancy work.
A copy of the invoice (partly redacted) is below.
Green Blue Skies Ltd (according to Companies House) is owned by its sole director Mrs Victoria Jane Kelly.
It’s a personal service company that provides professional services (as detailed on the invoice) to clients (in this case the Liverpool City Region Combined Authority).
As being paid for work through a limited company compared to being an employee of the Liverpool City Region Combined Authority led to tax advantages, in February 2017 Her Majesty’s Revenue and Customs (HMRC) issued guidance on what is termed off-payroll working rules.
The upshot of the guidance is that from February 2017 in relation to personal service companies providing services to public authorities such as the LCRCA was that when the off-payroll working rules applied the following should happen. Once the public authority was invoiced, the public authority would deduct the equivalent in tax and national insurance as if the person had been an employee from any payment made to the personal service company.
I just don’t understand why the two figures match when according to the guidance LCRCA should have deducted tax and national insurance from the amount paid?
Perhaps you could find out for me why and leave a comment?
Contact details for LCRCA’s Treasurer and external auditors are below.
A report on the Council meetings (Wirral Council) of 11th February 2013 along with video footage of the latter. The first was an extraordinary meeting to confer the title of Honorary Alderman on Kate Wood. The second was a regular meeting with motions on local government funding, health, housing, elections, benefits, Area Forums, tax credits, payday loans, public sector contracts and Universal Credit.
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Above is the first 2 1/4 hours of the Wirral Councill meeting of 11th February 2013.
Unfortunately the day this finally uploaded, someone rang up my ISP pretending to be the bill payer (my wife) and cancelled the ADSL line (which took a week to set up with another provider).
The first controversial point (at least if you’re a Conservative councillor) was the recommendation from Cabinet for approval by Council that Cllr Steve Foulkes be the Deputy Mayor for 2013/14. However to avoid any long drawn out debate on the merits of Cllr Foulkes as Deputy Mayor, the matter was simply noted on the basis that it’ll be decided at the Annual Council meeting of the 13th May 2013.
As usual only three notices of motion were debated, the first being Labour’s entitled Unfair Cuts in Local Government Funding, along with a Lib Dem amendment.
The second notice was a Conservative motion entitled Council Tax Referendum along with a Labour amendment and Lib Dem amendment.
Around this point I ran out of battery as the meeting was by now two and a quarter hours long.
The last notice of motion debated was a Lib Dem motion entitled Council Finances along with a Labour amendment.
A few of the motions not debated were unanimously agreed (well unanimous except for the abstention of the Mayor) (Vascular Services Review (about moving vascular services from Arrowe Park to the Countess of Chester), “Health Homes” and the Case for Selective Licensing of the Private Rented Sector and Construction Industry Blacklists).
For the rest of the motions and objections there were splits in the vote among party political lines. The first was “Attack on Democracy in Wirral” – a Conservative motion against the move to four yearly elections from 2015/6, the second was “The Empty Rhetoric of Localism” – a Labour motion about Council Tax Benefit, Crisis Loans and Community Care Grants, the third a Conservative objection against abolishing Area Forums and calling for consultation, the fourth a Lib Dem objection to abolishing Area Forums calling for it to be referred to a group of councillors to make recommendations on, the fifth a Labour motion entitled “Cuts to Tax Credits” (as well as a Conservative amendment and Lib Dem amendment), the sixth a Labour motion on “Payday Loans” (as well as a Conservative amendment and Lib Dem amendment), the seventh a Lib Dem motion on “Tax Avoidance and Public Sector Contracts” (as well as a Labour amendment) and the eighth a Lib Dem motion on “Universal Credit” as well as a Labour amendment.
The meeting finished with a number of changes agreed to committee places, after the recent by elections and resignation.