A regulatory impact assessment, published last week, puts forward this figure as the government's highest estimate of the extra administrative costs the new rules will impose.It consists of a one-off cost of up to £20m in the first year arising from learning the new rules and establishing new procedures. Annual compliance costs will be up to £9m higher than at present, and an additional compliance cost of up to £8m will be imposed on companies not caught up by the new rules, but still hit.The assessment said the government was hoping to raise an extra £220m a year in national insurance contributions from the changes.Accountants have continued to voice objections to the crackdown, which is intended to reduce tax and national insurance avoidance by employees masquerading as companies. Michael Snyder, senior partner at Kingston Smith, said: 'The proposal that certain personal services companies should not be allowed to pay out dividends or incentives, in a form enshrined in company law, is a regrettable precedent. It compels these smaller companies to abandon the freedom which all other companies have, to use legitimate methods to motivate employees in whatever way they feel fit.'
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