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ContractorCalculator: Contracting news in brief – 22/July/2016

Industry voices concerns at IPSE IR35 roundtable

Contracting stakeholders gathered last week at a roundtable event hosted by the Association of Independent Professionals and the Self Employed (IPSE) to discuss concerns about proposed public sector IR35 reforms. Attendees noted the excessive burden that looks set to be placed on contractor agencies, whilst one expert noted the impracticalities that agencies would be face if forced to deduct contractor tax via real time information (RTI). ContractorCalculator CEO Dave Chaplin was also on hand to share his expertise on IR35 and the complexities involved with developing an online tool to assess IR35 status. More...

Contractors could benefit from Government reform

Contractors could be amongst the beneficiaries of regulatory reform if the newly appointed Prime Minister Theresa May chooses to play to the country’s strengths. This is according to IPSE deputy director of policy Andy Chamberlain, who claims backing the flexible workforce should be high on the new Government’s list of priorities: “This is a good opportunity for the UK as a whole to take a look at what makes us different from other countries and to sustain and capitalise on the key skills that we have here already – the contingent workforce being a key provider of this.” More...

Non-compliant contractors taking unnecessary risk, experts warn

Contractors who attempt to hide the full extent of their earnings from HMRC are taking an unnecessary risk and face severe punishment, Recruitment International reports. This is the warning from Michelle Reilly, managing director of CXC Global EMEA, following the news that IT contractor Hamauon Khan has been given a four-year jail sentence for lying about his self-employment status to avoid paying tax of more than £170,000. “While the majority of contractors do operate on a wholly compliant basis, there are some that look to cheat the system,” comments Reilly. “The message is simple – it’s not worth it.” More...

Contract opportunities bounce back following EU uncertainty

Contractor demand benefited from a sharp increase in June, as clients absorbed the shock of Britain’s decision to leave the EU. Morgan McKinley’s latest London Employment Monitor reveals an 18% increase in available jobs, month-on-month, which was surpassed by a 19% rise in jobseekers. “A good portion of the jobs available came in during the last week of June, indicating that financial institutions held off on hiring until the referendum results were out,” highlights Morgan McKinley Financial Services operations director Hakan Enver. “It’s encouraging to see that businesses are still investing in staff.” More...

UK contractor numbers continue to climb

Contractors continue to contribute towards the sustained growth in self-employment, as shown by recent figures from the Office for National Statistics (ONS). The latest labour market statistics show a 300,000 rise in self-employed workers, bringing the total self-employed in the UK up to 4.79m in the three months leading to May 2016. “The increase in those choosing self-employment will be invaluable as the flexible workforce has been key to the UK's economic recovery to date,” notes Freelancer and Contractor Services Association (FCSA) CEO Julia Kermode. “Contractors are likely to play a very important role throughout what is undoubtedly an uncertain period.” More...

Contractor confidence dented by EU referendum outcome

Contractor confidence has dipped as a result of uncertainty caused by the Brexit vote, according to new survey findings from IPSE. The Freelancer Confidence Index for Q2 2016 shows that 49% of respondents feel negatively about their expected business performance over the coming year, compared to just 15% who feel positive. Despite this, the performance of contractor businesses remains strong, with pay rates and time spent working both increasing to the highest levels recorded. The Government’s attitude towards freelancing was determined to be another significant factor, with 81% citing it as a threat to business performance following proposed reforms to IR35 in the public sector. More...

‘Making Tax Digital’ doesn’t consider costs to contractors, NAO report finds

Contractors and other taxpayers need to be granted more consideration by HMRC as it develops its plans to implement a fully digital tax system by 2020. This is according to the HMRC Annual Report and Accounts 2015/16 carried out by the National Audit Office (NAO), which flags up two key areas of risk. Notably, it highlights that the taxman is yet to estimate the costs to taxpayers and businesses making the transition to online services. The report also notes the recent collapse in customer service HMRC suffered as a result of reduced helpline staff numbers as evidence that its key assumptions are often optimistic. More...

Cabinet reshuffle could mean tax cuts for contractors

Limited company contractors could benefit from tax cuts following the appointment of former foreign secretary Philip Hammond as the new Chancellor, reports International Adviser. Despite the announcement that Hammond has no plans for an emergency budget, financial planning expert at Old Mutual Wealth Rachel Griffin predicts contractors could see Corporation Tax slashed to 12.5% in a bid to retain business in the UK: “In light of the Brexit vote, the new Chancellor could be more aggressive and take the UK below Ireland’s rate of 12.5%, tempting companies to stick with their British bases.” More...

Payments on account deadline looms for contractors

Contractors have been told to ensure that they submit the second payment of their self-assessment tax return prior to the 31 July deadline, or risk unexpected costs, reports Accountancy Live. “If you miss your payment deadline, don’t be surprised if you receive calls or letters from the debt collection team,” comments Blick Rothenberg LLP assistant manager Paul Haywood-Schiefer, who notes the taxman has recently intensified efforts to track down outstanding tax. Contractors who miss the deadline will be charged interest at a rate of 3% per annum. More...

US emerges as potential source of oil and gas contracts

Oil and gas contractors in search of contracts should look to the US for opportunities. Rigzone cites a recent report by global investment firm Goldman Sachs which expects a substantial rise in US shale production in 2017. The report notes that the rig count in the US is expected to double by the end of next year, with 1,069 land rigs expected by Q4 2018. As a result, it is estimated that between 80,000 and 100,000 workers will need to be hired by the end of 2018 to manage the uptick. More...

Published: 22 July 2016

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