First batch of new IR35 compliance letters start hitting doormats
Contractors on the receiving end of the new batch of IR35 compliance letters from HMRC are urged to keep calm and seek expert advice before responding. These first IR35 compliance letters are part of HMRC’s new IR35 compliance measures, so are likely to have been sent to contractors seen by the taxman as being most likely to be inside IR35. “But just because HMRC believes you are at high risk, does not automatically mean that you are,” says Seb Maley of Qdos Consulting, adding that HMRC will withdraw from IR35 reviews when presented with compelling evidence that a contractor is not within scope. More…
IT contractors experience sharp fall in demand during May
Budget tightening and the Agency Workers Regulations (AWR) are thought by recruiters to be behind the sharp fall in demand for IT contractors reported in May’s Recruitment and Employment Confederation (REC)/KPMG Report on Jobs. The demand index in May fell below the 50-point mark, which indicates demand was weaker than the previous month, the first time this has occurred since the final quarter of 2010. That is at odds with the permanent jobs market, where IT is comfortably leading the field. Overall, contract/temp billing fell for the sixth month running and at the fastest pace since July 2009. More…
Engineering contractors and the Midlands drive year-on-year online demand growth
Online demand growth for engineering contractors rose by 2.5% in May compared to the previous month, an increase of 20% year-on-year. May’s Monster Employment Index also reported that the Midlands, where online demand for workers was up by 15% year-on-year “continued to lead all regions by measure of annual growth supported by increased recruitment activity across engineering, IT and sales.” The overall May index remained at the same level as April and online demand in the other core contracting sectors of IT and construction fell by 0.7% and 2.1% respectively.
Contracting growth markets are finance, business services and utilities
Contractors should consider targeting the finance, business services and utilities sectors for their next contract. This is according to the latest Manpower UK Employment Outlook survey, which reports that the UK’s labour market is showing “remarkable resilience given the bleak economic weather”. Manpower Group UK Managing Director Mark Cahill says: “When you’re going head to head with a return to recession at home and a burgeoning eurozone crisis, by rights the jobs market should be in free fall – but that’s not what we’re seeing. Firms are still looking to hire, albeit at a weaker pace than before, but the sort of hiring that is going on is where you’d least expect it.” More…
IT contractors have cause for cautious optimism following financial sector growth
Financial IT contractors received some positive feedback from The City following the latest Morgan McKinley London Employment Monitor’s news of a 17% month-on-month increase in new roles in London’s financial sector. Although the monitor highlights that vacancies in London are still 25% fewer than for the same time last year, it may be showing some signs of recovery. “This month our Employment Monitor recorded the largest number of jobs coming onto the market since August 2011,” Morgan McKinley Financial Services Chief Operating Officer Andrew Evans explains. “This is a good sign and indicates some recovery from the turmoil of [Q2 2011].” More…
Seven films celebrating freelancing and contracting to première on National Freelancers Day
Contractors can treat themselves to a night out at the movies in the run up to this year’s National Freelancers Day, which is on Wednesday 21 November 2012. The content programme for 2012 kicks off with a series of seven five-minute films created by freelance producer Rob Edwards and a team of freelance specialists. The films will bring to life key aspects of contracting and freelancing from a variety of perspectives, including: the client’s view, how contractors and freelancers add value, what it means to be a contractor and freelancer, how to do it properly, and how contracting and freelancing can benefit graduates.
A general anti-abuse rule (GAAR) could tackle contractors who push tax avoidance too far
Contractors are a step closer to becoming subject to a new general anti-abuse rule following publication of the government’s launch of a formal consultation. The government is committed to introducing GAAR following an independent review led by Graham Aaronson QC. He concluded that the introduction of a targeted rule would deter artificial tax avoidance schemes and contribute to providing a more level playing field for business. Based on the current proposals, most contractors will remain largely unaffected because GAAR is intended to tackle “artificial and abusive arrangements”. More…
Contractors should exploit mid-year window of client growth
Contractors may only have a short window to exploit new contract and client opportunities as, according to a survey BDO, UK business growth is forecast to peak in the third quarter. The latest BDO Output Index reports that short-term prospects for UK businesses are positive, but confidence will fall by the end of 2012, alongside falling hiring and business investment. BDO Partner Peter Hemington says: “While the UK economy is currently doing 'OK, considering', it's clear that UK business people are worried by the eurozone crisis and are scaling back plans for hiring and investing.” More…
Tech trends that may create future IT contractor demand
IT analyst Gartner has identified ten strategic technologies it believes will “be assimilated into management tools” and may provide IT contractors with future work streams. The technologies include obvious candidates such as cloud computing and media tablets and mobile devices, as well as areas such as the “internet of things” that embed sensors and intelligence into physical devices. Gartner anticipates these technologies will become a core component of organisational IT department strategies. They may, therefore, form the basis of new skills development and marketing strategies for IT contractors. More…
HMRC’s corporate ‘sweetheart deals’ challenged in the High Court
HMRC faces a judicial review following a High Court decision allowing tax avoidance pressure-group UK Uncut to challenge the taxman’s decision to let Goldman Sachs off £20m in interest payments from a £30m tax bill on bankers’ bonuses. However, a National Audit Office review has since concluded that the settlements reached by HMRC in five large tax cases, including the Goldman Sachs deal, “were reasonable”. HMRC plans to “strongly contest” the High Court decision in UK Uncut’s favour, claiming via Twitter that “Large business tax settlements are a vital part of securing revenues for UK. Without them UK's public finances would be seriously damaged.” More…