Government departments fined over off-payroll tax issues
5 March 2015
Two government departments have been fined nearly £1.5m, and 94 off-payroll civil servants have been “asked to leave” because they could not prove they were meeting their tax obligations, the government has revealed.
Thu, 5 Mar 2015Two government departments have been fined nearly £1.5m, and 94 off-payroll civil servants have been “asked to leave” because they could not prove they were meeting their tax obligations, the government has revealed.
Danny Alexander, chief secretary to the Treasury, today announced that the Ministry of Defence will be fined £1m for “failing to seek assurance from a number of workers on their tax arrangements due to [an] administrative error in 2012-13”.
The Department of Health will be fined £470,740 for two breaches at NHS England, where two board members were off-payroll for over a year, the statement said.
The fines will be donated to military and health charities.
The announcement came as the government published its second evaluation of rules designed to ensure that those working as temporary government contractors are meeting their tax obligations.
Departments had sought assurances of tax affairs from 2,505 people.
The government says that 95% of government departments were “broadly compliant” in ensuring that their contractors provided “satisfactory assurance” that their tax affairs were in order.
Responding to the announcement, IPSE, the association of Independent Professionals and the Self Employed, described the public sector tax rules are in effect “a sledge hammer to crack a nut”.
Andy Chamberlain, deputy director of policy and external affairs at IPSE, went on to say: “What was designed to prevent clear tax evasion by board level staff has now destabilised the position of specialist contractors and the projects they are working on.
“Government has a responsibility to ensure that the specialists with the right skills, who are very often independent professionals, are not driven out of the public sector by these rules.”
Danny Alexander, chief secretary to the Treasury, today announced that the Ministry of Defence will be fined £1m for “failing to seek assurance from a number of workers on their tax arrangements due to [an] administrative error in 2012-13”.
The Department of Health will be fined £470,740 for two breaches at NHS England, where two board members were off-payroll for over a year, the statement said.
The fines will be donated to military and health charities.
The announcement came as the government published its second evaluation of rules designed to ensure that those working as temporary government contractors are meeting their tax obligations.
Departments had sought assurances of tax affairs from 2,505 people.
The government says that 95% of government departments were “broadly compliant” in ensuring that their contractors provided “satisfactory assurance” that their tax affairs were in order.
Responding to the announcement, IPSE, the association of Independent Professionals and the Self Employed, described the public sector tax rules are in effect “a sledge hammer to crack a nut”.
Andy Chamberlain, deputy director of policy and external affairs at IPSE, went on to say: “What was designed to prevent clear tax evasion by board level staff has now destabilised the position of specialist contractors and the projects they are working on.
“Government has a responsibility to ensure that the specialists with the right skills, who are very often independent professionals, are not driven out of the public sector by these rules.”
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