IT, financial and accounting contractors to enjoy hiring boom
Contractors working in finance, accounting and IT look set to enjoy a hiring boom during the second half of 2014. Robert Half UK’s latest professional index shows that 44% of major contractor clients are planning to increase the number of contracts and jobs they offer. However, skills shortages are hampering hiring efforts, and half of the hiring managers surveyed said finding candidates with the right skills is “very challenging”. More...
Contractors may be “disproportionately” affected by HMRC’s proposed IHT changes
Moderately wealthy contractors are likely to be disproportionately hit by HMRC’s proposed changes to the inheritance tax (IHT) legislation. According to Out-Law.com, the anticipated changes limit tax relief on those who use multiple trusts to pass on their wealth. Pinsent Masons’ tax expert Janet Hoskin told Out-Law.com that: “The changes would create complications for those with life insurance policies, which are often structured into trusts to speed up payments on the death of the policyholder. Once again, those with only moderate wealth will be caught by changes aimed at the very wealthy.” More...
Contractors could see simpler expenses rules, but change unlikely until 2015
Contractors could see their expenses and subsistence paperwork reduce as a result of a new consultation launched by the Treasury. Building on the work of the Office of Tax Simplification, the consultation is designed to examine the existing and highly complex travel and subsistence rules, see where they can be simplified, and update them to new ways of working. Unfortunately, contractors are unlikely to see any changes until at least 2015 due to the “scope of the review and the complexity of devising a new set of rules”. More...
Contractor hiring increases across all sectors during July, reaching record highs
Contractor hiring continued to increase across the UK manufacturing, construction and services sectors, according to the latest set of Purchasing Managers’ Indexes (PMIs) from Markit and the Chartered Institute of Purchasing and Supply (CIPS).
- Growth in the manufacturing sector has been sustained for 17 months, creating the fifteenth consecutive month of contractor and employee hiring increases in the sector, shows the UK Manufacturing PMI
- According to the UK Construction PMI, the increase in new contracts and jobs during July reached a survey record. “Job creation across the construction sector was the fastest since the survey began in April 1997.”
- The UK Services PMI also saw new contracts and jobs generated at “a historically marked rate” as a result of sharp expansion of activity in the services sector. Growth has been spurred as a result of “new services, increased marketing and greater opportunities to tender”.
Oil and gas contractor prospects dented by falling North Sea confidence
Oil and gas contractor prospects may suffer as a result of falling confidence in the North Sea, unless the government incentivises more exploration drilling. Oil & Gas UK’s Q2 2014 Business Sentiment Index shows that industry optimism fell for a fifth consecutive quarter. “While businesses remain in optimistic territory overall, this is not a trend our industry can afford to ignore,” says Ken Cruickshank, Oil & Gas UK’s operations manager. “We are clear that fundamental change is needed to change the way the industry is taxed and regulated, if the UK is to maximise economic recovery from the UK Continental Shelf (UKCS).” More...
IT and financial contractors may benefit from government FinTech measures
IT and financial contractors may see some benefits and more contracts as a result of the government’s latest measures to make the UK the leading centre of financial technology, or ‘FinTech’. The measures“to cement Britain’s position as the centre of global finance” include looking at how technology serves the financial sector, expanding the use of virtual currencies and developing the scope of alternative lenders. This provides an indication of the skills contractors may need to acquire to take full advantage of government plans for the UK’s financial sector. More...
Contractors using non-DOTAS tax schemes may find themselves subject to new rules
Contractors who are using tax schemes that currently do not have to be registered under the Disclosure of Tax Avoidance Schemes (DOTAS) may soon find themselves subject to HMRC’s new accelerated payment rules. Out-Law.com reports that HMRC has proposed to widen the DOTAS scheme scope so that accelerated payments can be applied in more cases. This means more contractors may find themselves paying the tax they hope to save from the scheme up front, before HMRC even begins its challenge. More...
Contractors will remain largely unaffected by Oziegbe vs HMRC ruling
Contractors are unlikely to be able to use the results of the Oziegbe ruling to help with determining the control element of IR35 status. Qdos Consulting’s Andy Vessey highlights that the taxman’s case was flawed from the outset and should never have reached a tribunal. “This case will have no bearing on most false self-employment and IR35 cases,” believes Vessey. “It might give a crumb of comfort to some contractors in very niche examples, but it does not really say a great deal about control.” More...
Contractors can extract cash tax efficiently from companies using new MVL service
Contractors can access a new service that will help them to extract cash more tax efficiently from their limited companies using a Members Voluntary Liquidation (MVL). Accountant Johnston Carmichael has launched Contractor MVLs to enable contractors with more than £40,000 of cash in their company to save tax when the company closes. “Many contractors will already have arranged their tax affairs efficiently, by providing services through a limited company,” explains Johnston Carmichael partner Donald McNaught. “It makes sense that when that company is no longer required, they continue to apply tax-efficient strategies to close it down.” More...