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ContractorCalculator: Contracting news in brief – 13/June/2014

Contracting rates increased during May 2014 at a pace not seen since December 2007

Contractor pay rates increased at near record levels during May 2014, shows the latest Recruitment and Employment Confederation (REC)/KPMG Report on Jobs. The rate of pay growth was the fastest since December 2007. The number of contract vacancies and agency billings also grew, coupled with falling contractor availability. “The UK’s jobs boom continues, with vacancies increasing as employers look for new workers to meet increasing demand and to replace staff that have been snapped up by competitors,” says REC CEO Kevin Green. “However the big issue remains that employers are finding it hard to find the talent and skills they need.” More...

Contractors stuck with IR35, as the government brushes aside Lords’ findings

Contractor hopes that IR35 might be reformed have been dashed by the government’s response to the House of Lords’ Select Committee PSC inquiry. “IR35 is with us for the foreseeable future,” notes ContractorCalculator CEO Dave Chaplin. The Lords’ conclusions have been effectively been brushed aside by the government. And where there was any criticism of HMRC or the government’s actions, the response has been to say, ‘we will review that’. More...

Contractors continue to suffer from HMRC’s poor service

Contractors continue to suffer from unacceptable HMRC services standards, claims the Institute of Chartered Accountants in England and Wales (ICAEW). Economia reports that exchequer secretary David Gauke has been told that, although standards have “improved since they hit rock bottom three years ago” they are still not acceptable. By some measures, such as call handling, HMRC’s performance has actually worsened. More...

Contractor numbers surge again during the quarter to April 2014

“Self-employment really is the future of work.” So said PCG economist Georgios Nikolaidis in response to figures showing the number of self-employed workers and contractors rose again to reach new highs of 4.537m in the quarter to April 2014. These figures from the Office for National Statistics confirm four quarters of unbroken growth in the UK’s self-employed population. “Today’s figures from the ONS show self-employment grew again by 1.6% on the last quarter and 8% on last year to reach 4,537m – compared to a 1% and 1.8% respective growth in ‘traditional’ employment,” says Nikolaidis. “The confidence to go it alone is clearly spreading across the entire workforce and this can only be good news for our economy.” More...

Contractors deserve greater protection from tax policy generated by HMRC

Contractors and other taxpayers should be protected from the damage caused by poorly thought through tax policy by the creation of an independent body with veto powers over new tax laws. This is the conclusion of a City of London Law Society committee that has called for the creation of “an independent body with the power to veto tax legislation”. According to the committee: “HMRC officials may have understated difficulties when briefing ministers. At other times, policy has ‘clearly been driven from the political level without due considerations, with HMRC left to pick up the pieces’.” More...

Contractor hiring “set to hit record level”

Contractors look set to benefit from record hiring levels and strong employment and investment intentions, according to two surveys from BDO. The EEF (formerly known as the Engineering Employers’ Federation)/BDO Manufacturing outlook forecasts continued improvements in output that are predicted to result in fresh contracts. The BDO Business Trends Report and Employment Index signal that “companies plan to continue bolstering workforces above the long-term average rate over the next three months”. More...

USA IT contract market grows, offering opportunities to UK contractors

The IT contract market in the USA has been steadily growing over the last year and, despite some major clients cancelling significant hiring programmes, sentiment remains very positive. Staffing Industry Analysts reports that 63,700 new jobs and contracts were created in the “Computer Systems Design and Related Services” sector, suggesting that the buoyant USA market could offer UK-based contractors new contract opportunities. More...

Umbrella contractors want a greater degree of HR support

Umbrella company contractors expect and want a higher level of human resources support from their professional employment services provider. A survey by Giant Group, reported by Staffing Industry Analysts, indicates that 64% of umbrella contractors want access to employee benefits programmes, and 87% want an employee portal. “It’s clear from the results of this survey that contractors are no longer just after the admin support and salary security that has previously been associated with professional employment providers,” notes Giant Group managing director Matthew Brown. More...

Contractors to benefit from further PCG-led research

Contractors are likely to benefit from the latest research being coordinated by PCG. The contractor organisation has recently hosted a ‘Global Freelancing Research Seminar’, in partnership with Professor Andrew Burke from the Cranfield School of Management and Professor Patricia Leighton from the IPAG Business School. “The seminar was the first in a series which will drive the agenda for research into self employment and independent working forward,” says PCG Policy Research Manager Suneeta Johal. “It was a great success and the research that has already been coordinated as a result will help to inform PCG’s strategy for the future.” More...

Reduced VAT admin burden for contractors providing digital services

Contractors who provide digital services, such as apps and other online solutions, will be able to operate a more streamlined VAT regime following changes to VAT laws coming into force on 1 January 2015. According to HMRC, the “place of supply – and therefore the place of taxation – for business-to-consumer suppliers of digital services will change to the place where the customer who receives the service lives or is located”. HMRC’s deputy director indirect tax, Sally Beggs, explains: “VAT Mini One Stop Shop online service – VAT MOSS –is a tool that saves digital services suppliers from having to register for VAT in every member state in which they sell such services.” More...

Published: 13 June 2014

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