MSC Tax Tribunal outcome poses threat to contractors
Contractors who let third party service providers handle their financial affairs could unwittingly be at risk from the Managed Service Company (MSC) legislation. This is the warning from Andy Vessey of Qdos, following a Tax Tribunal where five medical contractors were judged to have engaged with an MSC and were ordered to pay £160,000 in backdated tax between them. “The broad manner in which its [the legislation’s] definitions can be adopted might open the way for a lot more of these cases,” says Vessey, who encourages contractors to seek assurances from their providers, as well as a professional opinion. More...
Finance leaders in the capital increasingly sought after
Contractors with leadership experience in London’s finance sector are seeing an acceleration in demand for their services, Staffing Industry Analysts reports. Data analysis from finance recruitment firm Sonovate shows that vacancies for senior level contract roles in Q1 2016 have risen by 23%, quarter-on-quarter, with director-level vacancies increasing by 39% within this timeframe. “Quality leadership isn’t necessarily about the long-term anymore,” notes Sonovate co-CEO Richard Prime. “More and more companies are onboarding senior staff to shepherd projects towards completion – or just to have a steady hand on the tiller in the midst of a storm.” More...
Contract opportunities emerge in oil and gas sector courtesy of IoT
Contract opportunities are still emerging in the UK’s oil and gas sector, despite the industry downturn. Whilst traditional engineering roles remain sparse, developments in technology and the increasing emphasis on efficiency mean contractors with specialist skills could find demand for their services. Rigzone highlights the Internet of Things as an emerging source of contracts in the upstream sector as firms increasingly look towards automating operations. “The industry is likely to need specialist engineers who can not only build smart devices, but who will know how to apply them to equipment in the upstream sector,” the article reads. More...
Contractors could take advantage of slowing cross-sector momentum
Contractors are on hand to plug skills gaps when required as firms respond to slowing momentum by moderating – or sometimes reducing – permanent headcounts. The latest Purchasing Managers’ Indexes (PMIs) from Markit and the Chartered Institute of Purchasing and Supply (CIPS) note that firms are adopting an increasingly cautious approach, which may suggest a preference for low-risk contingent hires. This month’s PMIs highlight:
- Contractors could be required to plug skills gaps if the manufacturing sector regains momentum after further headcount cuts were made in April. The UK Manufacturing PMI attributes this to near-stagnant trends in new orders and output, with clients erring on the side of caution due to uncertainty concerning the oil and gas industry and a potential Brexit, amongst other factors.
- The UK Construction PMI reports further output growth in April, although conditions remain subdued. Although staffing levels within the sector continued its trend of growth which spans back to June 2013, the latest increase was modest as firms implement more cautious hiring policies. As a result, sub-contractor usage increased for the first time in three months.
- Headcounts continued to rise at a moderated pace in the service sector last month. The UK Services PMI shows that this is largely in keeping with the modest growth across the sector as a whole. The report attributes the slowing momentum to “the early timing of Easter and uncertainty about the EU referendum” suggesting that contractors can expect the sector to bounce back quickly, pending a favourable outcome.
Umbrella firms still offer viable trading vehicle for contractors
Contractor umbrella companies will continue to evolve and play an important role in the contingent supply chain, despite changes to travel and subsistence (T&S) legislation. This is according to managing director of giant group Matthew Brown, who claims many of his firm’s contractors don’t claim expenses, adding: “It’s not just about take-home pay.” Referring to the public sector IR35 reforms for personal service company (PSC) contractors, and the potential rollout into the private sector, Brown concludes: “With all new legislation a new equilibrium is found between umbrella employment and PSC’s and both will continue to play an important part in the supply chain. More...
Finance contractor demand could benefit from employee dissatisfaction
Contractors in London’s finance sector could see heightened demand for their services after a new study revealed a quarter of permanent staff are considering leaving firms as they are not satisfied with their bonuses. 25% of respondents to Morgan McKinley’s 2016 Bonus Survey claimed they would look to leave their current employer because their bonus didn’t meet expectations, paving the way for potential contract opportunities. Overall, of the 39% who received a bonus, 26% saw their bonus decrease, compared with the year before. This figure notably increases to 30% for those with 15 or more years’ experience. More...
Contractors contribute to HMRC tax avoidance crackdown yield
Contractors are amongst those who have contributed to an additional £494m income tax yield for HMRC following its campaign against tax avoidance schemes. Law firm Pinsent Masons notes that this amount was gathered between 2014 and 2015 after HMRC ramped up its efforts. Accountancy Age reports that celebrities have been the main target, however the Revenue has recently come in for criticism for disproportionately focusing on ‘soft target’ contractors. HMRC has been aided by the introduction of accelerated payment notices (APNs), which require individuals to pay requested sums up front without having the option to dispute them. More...
Contractor confidence levels remain high despite bleak economy outlook
Contractors remain confident in their own business performance, in spite of less promising indications concerning the economy as a whole. This is according to the latest Freelancer Confidence Index from the Association of Independent Professionals and the Self Employed (IPSE) which shows that more than two thirds (68%) of contractors are equally or more confident in their business outlook than they have been over the previous 12 months. Contrary to this, 52% have a less confident outlook for the UK economy over the coming year, with 56% anticipating that business costs will rise. More...