IR35 generates a return of only £300k a year, according to HMRC
IR35 costs approximately £700,000 each year to administer, yet it generates only £1m a year in tax yield. This is according to evidence supplied by HMRC to the House of Lords Select Committee on Personal Service Companies (PSCs) inquiry. The same session also saw representatives from industry adding further evidence to the fact that contractors are highly paid and highly skilled, and choose to operate via PSCs for commercial reasons, not to avoid tax. More...
Limited company contractors not the target of the proposed False Self-Employment legislation
Limited company contractors are not the target of the proposed False Self-Employment legislation, according to a briefing by HMRC. This confirms the position adopted by law firm Lawspeed that a technicality means contractors taking remuneration via dividends won’t be affected if the law comes into force. PCG also agrees with this analysis, although it warns that the government is working towards an “ambitious timetable”. PCG says it will remain vigilant for unintended consequences of the rules. More...
Contractor demand sustained at near record highs during January
Contractor demand eased only slightly during January 2014, remaining at near record highs, according to the latest Recruitment and Employment Confederation (REC)/KPMG Report on Jobs. Demand for engineering contractors surged into first place, from sixth during December. In contrast, demand for IT contractors slid from first to sixth place. “There are skills shortages across all sectors,” noted REC’s policy director Tom Hadley. More...
Contracting market grows by 8.7% year-on-year, according to APSCo
The UK’s professional contracting market has grown by 8.7% year-on-year, according to the latest figures from the Association of Professional Staffing Companies (APSCo). IT is leading the market, and the evidence is that “contracting is the new norm”, with clients using contractors as “a matter of course” for new tech projects. “IT skillsets that are trending up are security experts, social media architects and cloud computing specialists,” says John Nurthen, executive director of international development for Staffing Industry Analysts, the firm behind the survey. More...
Interim management contractors in the UK, Belgium and Holland lead interim market
Interim management contractors in the UK, Holland and Belgium are the most likely to be in contract, shows new research by contractor agency Executives Online. Average rates are highest in Germany, at €927 per day with UK interims earning an average of €760 per day. “Interim managers have a unique vantage point from which to assess the direction of the economy and business cycle,” says Executives Online director Andrew Nicholas. More...
Construction contractor prospects at seven-year high
Construction contractors enjoyed another month of strong hiring and confidence during January 2014. The rate of new orders for construction contracts was at its highest level for seven years. Confidence reached its highest level since September 2009, which further supported strong hiring. “The construction industry has started 2014 in formidable fashion, enjoying its strongest growth in six-and-a-half years, reinforced by a sharp rise in new business orders,” says Chartered Institute of Purchasing and Supply (CIPS) CEO David Noble. More...
SME investment presents opportunity for contractors
The UK’s small to medium sized enterprises (SMEs) represent a growth opportunity for the contractors. Small firms, which are not always the traditional recruiting ground for contractors, are hiring and are optimistic about future business conditions. “Orders and output continued to grow at a healthy pace [during the three months to January 2014],” explains CBI director of economics Stephen Gifford. “Firms remain optimistic about prospects, with growth in orders and production expected to accelerate.” More...
Contractors being forced to pay tax up-front is “against natural justice”
Government proposals to make the participants of tax avoidance schemes pay tax up-front “run contrary to ‘principles of natural justice’”. This is the view of law firm Pinsent Masons, which says: “This is an audacious move. These proposals are subject to consultation but, despite question marks over their legality, the current backlash against tax planning could allow them to push them through.” More...
Unconventional oil and gas contractor opportunities a step closer in Poland
Oil and gas contractors with shale gas development skills could find that proposed legislative changes in Poland may offer new contract opportunities. The Polish prime minister has confirmed that new shale gas-investor-friendly laws will be enacted within a fortnight. Recent drilling tests have confirmed that the country has significant commercial potential. Ministers confirmed that commercial production could begin as soon as 2014. More...
Senior HMRC officials to strike over having to implement performance measures
Senior tax officials plan to strike over having to implement performance measures. HMRC chief executive Lin Homer was told by the top 2,500 ‘mandarins’ that they object to new rules forcing them to find one in ten HMRC employees to be ‘underperforming’. The Guardian’s Rajeev Syal reports: “HMRC is now under so much pressure to target evasion and avoidance that it has been forced to shift more of its budget towards enforcement, and so has less capacity to deal with run-of-the-mill inquiries from customers.” More...