ContractorCalculator: Contracting news in brief - 24/Feb/2012

All quiet on the IR35 Forum front

Contractors are awaiting the results of the latest IR35 Forum meeting that was held this week, as it is likely to be the last meeting before any new measures are announced in the 2012 Budget. The meeting was supposed to take place in January, but was postponed – apparently as a result of the volume of work generated by sub-committees in early January. These meetings are believed to have focused on IR35 case administration, IR35 scenarios and ‘in-business’ tests. If the Forum follows its previous convention, the minutes are likely to appear about the same time as its efforts are reported in the 2012 Budget in late March.

Driving limited company contractors out of the public sector will hurt us all

Successful public sector contractors genuinely in business deserve recognition for their contribution, not the government and media driven witch-hunt aimed at forcing them to change their legitimate limited company trading structures, believes ContractorCalculator CEO Dave Chaplin. “By driving limited company contractors out of the public sector, costs will increase, skills will be lost and quality of service delivery will fall, ultimately leaving taxpayers worse off,” he says. More…

IT led the expansion of contractor demand in Scotland in January

IT contractors dominated a surge in contractor demand in Scotland during January. The Bank of Scotland Report on Jobs reveals that temp billings increased during the month, reversing the previous two month’s decline, and that growth in billings rose at the fastest pace since August 2011. Engineering and construction contractors also experienced an increase in demand for their services, but at a slower rate than in IT. More…

Contractors can claim full exemption for smartphones: smart new HMRC guidance

Contractors will no longer be required to pay additional benefit in kind income tax charges or National Insurance Contributions (NICs) for company smartphones. Previously, HMRC had considered smartphones to be computer equipment, so contractors using company supplied smartphones for personal use have suffered a benefit in kind charge. The new guidance from HMRC puts smartphones on an equal footing with mobile phones, which means a contractor can have a single exempt smartphone and now enjoy unlimited personal use.

Calls for business-friendly Budget could have positive impact on contracting

Contracting will benefit directly if Budget measures sought by the Confederation of British Industry (CBI) are adopted by Chancellor George Osborne in March. The CBI’s suggested initiatives to accelerate infrastructure projects, increase inward investment and offer greater financial support to the UK’s mid-sized businesses would all be likely to increase contractor demand. More…

Tax reprieve hope for higher earning contractors

Contractors paying 50% tax received a glimmer of hope that the top rate of tax may be abolished. A report by Robert Winnett in The Daily Telegraph indicated that the Treasury’s self-assessment income receipts in January 2012 fell by £509m compared to January 2011. According to Winnett, Treasury sources have suggested that “there had been ‘manoeuvring’ by well-off Britons to avoid the new higher rate” and that “the figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad”. More…

Contractors to benefit from moderate and strengthening economic growth in 2012

Contractors can look forward to moderate growth and a strengthening economy later in 2012, according to Bank of England Deputy Governor Charlie Bean. In a speech to the Scottish Council for Development and Industry, Bean said recent indicators of UK growth have been encouraging, adding “growth should gradually strengthen”. But he confirmed that the UK’s debt burden and the potential for eurozone recession may continue to have a negative impact on growth and contractor’s, prospects. More…

Contractors who filed late tax returns can expect their fines soon

Contractors who missed the online self-assessment tax return deadline can expect their £100 fines within a fortnight. This is according to HMRC, which expects to issue 850,000 fines for late tax returns. Although this figure seems high, it is 550,000 fewer than the same time last year. Contractors believing they have a ‘reasonable excuse’ for filing a late return should appeal when notified of their penalty.

Reduced reporting burden on the cards for contractor limited companies

A reduction of the financial reporting requirements for contractor limited companies is a step closer following a decision by the European Commission (EC) to relax reporting requirements for ‘micro-entities’. Member states can exempt the smallest companies, including contractor limited companies, from accounting requirements allowing them to file simplified accounts. The Department for Business, Innovation and Skills (BIS) estimates that up to 1.5m businesses in the UK could be affected. More…

Published: Thursday, February 23, 2012

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