On an average day, I can be working on a wide range of matters. They can include the equity incentives aspects of an international transaction, a share plan for a tech start-up, employment tax issues for UK and internationally mobile employees, management incentive plans for larger companies and advising a number of our US clients setting up business in the UK on equity for UK employees. I really enjoy the variety of clients and work.
If you could make one change to a tax law or practice what would it be?
I would ask HMRC to bring back the post transaction valuation check (PTVC). The PTVC enabled taxpayers to determine their exposure to income tax (and NICs) under the employment-related securities legislation. If a company cannot use tax favoured equity incentives due to its structure, then any non-tax favoured incentives need some form of valuation, which can be provided by an external valuer but does not have the certainty of the PTVC.
What do you know now that you wish you’d known at the start of your career?
I would like to have known how important it is to be flexible in your approach to tax law, to clients and to your career. When I started at Clifford Chance as a general tax practitioner, I had no idea that I would go on to specialise in share schemes and employment tax and that I would also find myself working in a ‘big four’ firm at some point, before joining Taylor Wessing 11 years ago. I would also have liked to know how much the role of a lawyer would evolve into being a trusted business adviser and how important it is to work as part of a team in delivering solutions to clients.
What do you make of the chancellor’s U-turn over NICs?
The original intention behind the proposed (and then abandoned) increase in the rate of NICs for self-employed individuals was to level the treatment of the self-employed and the employed. However, it did not address the ‘elephant in the room’ that an employer has to pay employer NICs for an employee and there is no equivalent for self-employed individuals. Addressing this difference would require a more radical change to the national insurance system. The government has not been keen to make radical changes, as was evidenced by consulting on proposals to combine income tax and national insurance in 2011, and then deciding not to take any action. It is also a feature of many other tax systems that there are equivalent charges for employees, the self-employed and employers, and the UK has international agreements with other countries as to where such charges are paid when individuals move between countries and work in more than one country. Therefore, any changes to NICs would need to take this wider issue into account. These reciprocal arrangements will need to be extended following Brexit as the EU regulations on social security will no longer apply to the UK.
The difference in tax and NICs for the self-employed and employees is just one part of the debate on the ‘gig economy.’ There is a need to maintain fairness for workers from an employment law point of view (evidenced by the number of recent cases involving Uber, Deliveroo, CitySprint and Pimlico Plumbers). Other issues include the erosion of tax receipts for the Exchequer, the simplicity of administration and collection of taxes for HMRC and certainty for the providers and recipients of services. One solution might be a levy equivalent to employer NICs, levied on providers of services engaging with the self-employed, to level the playing field. This would not be very popular with such providers.
You might not know this about me…
After years of taking my three children to a number of sporting activities, I went on a learn to row course about three years ago and now spend a great deal of my time at weekends rowing, coaching rowing and racing. It is never too late to try something new!
On an average day, I can be working on a wide range of matters. They can include the equity incentives aspects of an international transaction, a share plan for a tech start-up, employment tax issues for UK and internationally mobile employees, management incentive plans for larger companies and advising a number of our US clients setting up business in the UK on equity for UK employees. I really enjoy the variety of clients and work.
If you could make one change to a tax law or practice what would it be?
I would ask HMRC to bring back the post transaction valuation check (PTVC). The PTVC enabled taxpayers to determine their exposure to income tax (and NICs) under the employment-related securities legislation. If a company cannot use tax favoured equity incentives due to its structure, then any non-tax favoured incentives need some form of valuation, which can be provided by an external valuer but does not have the certainty of the PTVC.
What do you know now that you wish you’d known at the start of your career?
I would like to have known how important it is to be flexible in your approach to tax law, to clients and to your career. When I started at Clifford Chance as a general tax practitioner, I had no idea that I would go on to specialise in share schemes and employment tax and that I would also find myself working in a ‘big four’ firm at some point, before joining Taylor Wessing 11 years ago. I would also have liked to know how much the role of a lawyer would evolve into being a trusted business adviser and how important it is to work as part of a team in delivering solutions to clients.
What do you make of the chancellor’s U-turn over NICs?
The original intention behind the proposed (and then abandoned) increase in the rate of NICs for self-employed individuals was to level the treatment of the self-employed and the employed. However, it did not address the ‘elephant in the room’ that an employer has to pay employer NICs for an employee and there is no equivalent for self-employed individuals. Addressing this difference would require a more radical change to the national insurance system. The government has not been keen to make radical changes, as was evidenced by consulting on proposals to combine income tax and national insurance in 2011, and then deciding not to take any action. It is also a feature of many other tax systems that there are equivalent charges for employees, the self-employed and employers, and the UK has international agreements with other countries as to where such charges are paid when individuals move between countries and work in more than one country. Therefore, any changes to NICs would need to take this wider issue into account. These reciprocal arrangements will need to be extended following Brexit as the EU regulations on social security will no longer apply to the UK.
The difference in tax and NICs for the self-employed and employees is just one part of the debate on the ‘gig economy.’ There is a need to maintain fairness for workers from an employment law point of view (evidenced by the number of recent cases involving Uber, Deliveroo, CitySprint and Pimlico Plumbers). Other issues include the erosion of tax receipts for the Exchequer, the simplicity of administration and collection of taxes for HMRC and certainty for the providers and recipients of services. One solution might be a levy equivalent to employer NICs, levied on providers of services engaging with the self-employed, to level the playing field. This would not be very popular with such providers.
You might not know this about me…
After years of taking my three children to a number of sporting activities, I went on a learn to row course about three years ago and now spend a great deal of my time at weekends rowing, coaching rowing and racing. It is never too late to try something new!
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