New tax calculator published for contractors following dividend tax change
Contractors can calculate how much extra dividend tax they will pay from 6 April 2016 with the new ContractorCalculator Dividend Tax Changes Impact Calculator. The Chancellor George Osborne announced a dividend tax reform in his 2015 Summer Budget that will result in many more contractors and small business owners paying dividend tax. ContractorCalculator CEO Dave Chaplin expects contractors will be hit hard by the legislation: “Contractors taking a salary of £8,040 will start to pay extra tax with a dividend as low as £9,000, which represents an annual income of only £17,040.” More...
Contractor demand to continue as skills shortages linked to education
Contractors can expect sustained demand for their services over the long-term as businesses continue to struggle to source sufficiently skilled candidates. This is according to the Confederation of British Industry (CBI)/Pearson Education and Skills Survey 2015, which suggests reforms in higher education and apprenticeships may be required to reduce the skills deficiency. “Skills shortages will inevitably always be with us, as technology continues to steal a march on the workforce. However, contractors can respond quicker than the mainstream employment market, so will always be ahead of the curve,” highlights ContractorCalculator CEO Dave Chaplin. More...
Contractor expenses tax relief
Contractors working via umbrella companies and personal service companies (PSCs) who are facing losing tax relief on the travel and subsistence expenses have the Freelancer and Contractor Services Association on their side. They are pursuing an amendment to legislation in the March Finance Act. As it stands, from April 2016, contractors won’t be able to claim tax relief on travel and subsistence expenses at source and will instead have to wait several months to claim via a self-assessment tax return. Due to the pre-election build up, there were only two days from the legislation’s publication to it becoming enacted, leaving no opportunity for affected parties to appeal. “It is unforgivable to knowingly introduce legislation that will reduce income for a specific element of the workforce,” highlights Julia Kermode, CEO.
Contractors to receive tailored training and education from IPSE
Contractors can expect greater educational and training opportunities in the future, according to Lydia Wakefield, training manager for the Association of Independent Professionals and the Self-Employed (IPSE). Issues such as shift patterns and costs have typically prevented contractors from undertaking training, which Wakefield claims is vital to their prosperity: “Contractors need to up-skill constantly to ensure they are leaders in their field and maintain their reputation with clients.” IPSE plans to provide discounts on training courses to its members, which will be tailored to suit the specific needs of contractors. More...
Contractors continue to suffer cashflow issues due to slow paying clients
Contractors and micro-business owners are being put at risk by slow paying clients, according to a poll carried out by YouGov on behalf of accountancy software firm FreeAgent. The research, which surveyed more than 500 micro-business owners and contractors, found that 86% of respondents have issued invoices that have been paid late, whilst one in eight have had to wait over a year for payment. “When you’re running a business it’s really important to get paid quickly – late-paying clients can create major cash flow problems which, in extreme cases, can lead to the failure of your business,” emphasises FreeAgent CEO Ed Molyneux. More...
Contracting abroad in Ireland more attractive as professional vacancies increase
Contracting in Ireland is becoming an increasingly more viable option as professional contract and job vacancies have increased by 19% compared to June last year, shows the Morgan McKinley Irish Employment Monitor for June 2015. “A renewed sense of confidence has been driving activity so far this year, particularly in finance, banking and IT sectors,” highlights Morgan McKinley Ireland Chief Operations Officer Karen O’Flaherty. These sectors are thriving because many professionals are leaving permanent positions to seek more lucrative contracting roles. Meanwhile, employers are finding themselves increasingly requiring multilingual staff, with Dutch, German and Nordic languages most in-demand. More...
ICA update: construction contractors tax avoidance and income splitting
Contractors in Australia in the construction sector appear to be responding to an unpopular tax scheme by under-reporting tax, according to Independent Contractors Australia (ICA). Following a tax sweep which gained an additional $2.3bn in tax from construction contractors, a recent report by the Australian Taxation Office (ATO) claims that 53,000 contractors have under-reported their incomes, whilst 76,000 still haven’t lodged 2012-13 tax returns. Meanwhile, the ICA has moved to clarify confusion over personal service income tax rules, stating that income splitting is perfectly legal if those involved are a partnership. More...
Self-employed contractor numbers suffer sharp decline
Self-employed contractor numbers have fallen sharply over the past year, according to the latest ONS Labour Market Statistics. In total, the period from January to March 2015 saw 71,000 less self-employed workers than at the same point in 2014, a 2.3% decrease. “Today’s figures show a significant fall in the number of self-employed people working in the UK,” notes Association of Independent Professionals and the Self-Employed (IPSE) chief executive Chris Bryce. “This sector is absolutely crucial to the economic success of the UK, and Government should consider ways it can better support people who work for themselves.” More...
Contractor organisation IPSE picks up top prize at Trade Association awards
Contractor membership organisation the Association of Independent Professionals and Self Employed (IPSE) picked up three gongs last week at the Trade Association Forum’s (TAF) annual awards, including the prize for Trade Association of the Year. In addition, IPSE also collected the award for Sector Representation, whilst the IPSE arranged National Freelancers Day won Event of the Year. “Everyone at IPSE is immensely proud to be recognised at the prestigious TAF Best Practice Awards for the work we have done to represent our members up and down the country,” said IPSE chief executive Chris Bryce. More...
Contractors warned by HMRC to beware of phishing emails
Contractors are being encouraged to take note of updated HMRC advice on differentiating between genuine HMRC correspondence and phishing emails. This comes after news that nearly 51,000 phishing emails were reported between April and July last year, twice the amount received over the same period in 2013. The advice details the various forms of communication contractors can expect to receive from HMRC, while encouraging readers to look out for spelling and grammatical errors. HMRC also emphasises that none of its text or email communications will ever ask taxpayers to provide personal or financial information. More...