The UK needs fresh thinking, not more patches, to respond to changing work patterns
The UK tax system no longer delivers the required flow of National Insurance Contributions (NICs) because the workforce has evolved from industrial age full employment to a flexible knowledge economy, writes ContractorCalculator CEO Dave Chaplin. He says adding legislative patches, such as the controlling persons legislation, only chokes off the cash the economy needs for growth. “We need to encourage flexible knowledge workers such as contractors to become part of the UK’s economic growth solution, not put them off,” he concludes. More...
MPs don’t want to be treated like employees when it comes to their expenses
MPs are refusing to accede to HMRC’s demands that their accountancy expenses be treated the same as any other employees’, such as umbrella and limited company contractors, reports Rajeev Syal and Ed Howker in the Guardian. Parliamentary expenses watchdog the Independent Parliamentary Standards Authority (IPSA) currently allows MPs to claim the costs of their accountant as a tax deductible expense. Letters seen by the Guardian reveal that “tax officials have repeatedly told IPSA that other employees are not allowed to claim back professional fees or the tax, and MPs should not be given special dispensation.” Both IPSA and HMRC refuse to budge and the dispute continues. More...
Controlling persons legislation is not needed, tax body tells government
The controlling persons legislation is not needed and contractors abusing tax rules at a senior level in the public sector can be dealt with by existing legislation, such as IR35. This is according to tax body the Chartered Institute of Taxation (CIOT) in its response to the government’s controlling persons legislation consultation. “The consultation document does not identify a particular mischief that is occurring in the private sector that is not already addressed by the IR35 rules and the rules on agency workers,” comments CIOT tax policy director John Whiting.
Change management has emerged as a new job discipline for interim managers
Interim management contractors are increasingly likely to find themselves hired to implement change management and transformation programmes by clients “bored with a no-growth economy, keen to move ahead and with funds on hand”. That’s according to anew survey of 12,000 UK-based interims by interim recruiter Russam GMS. “Change management has emerged as a new job discipline in interim management,” notes Russam GMS chairman Charles Russam. “Increasingly, CEOs are hiring interim change management experts to help them handle their toughest business challenges and to move their business to the next level.” More...
Oil & gas contractor prospects buoyed by skills shortages as confidence reaches record high
Oil and gas contractor prospects in the UK’s upstream sector are looking increasingly positive, according to Oil & Gas UK’s latest business confidence index. The index is at its highest level since records began four years ago, with increased global demand for UK-based exploration and oilfield services firms. “Contractors continue to enjoy high activity levels fulfilling existing contract commitments in the UK as well as expanding the export of their services and products to clients around the globe,” explains Oil & Gas UK supply chain director David Ripley.
Contractor demand in Scotland bounced back in July, with modest gains in IT and engineering
Contractor demand in Scotland went back up in July, after June’s fall from a 22-month high.July’sBank of Scotland Report on Jobsshows the core contracting sectors of IT, engineering and construction still in growth territory, but showing only modest gains. However, Scotland’s IT and computing contracting industry continues to significantly outperform the rest of the UK. IT showed a ‘marked rise’ in July, and clients experienced falling availability of contractors in key locations, such as gaming industry hotspot Dundee. More...
Contracts on hold due to delayed investment: ‘ineffective’ government told it must do more
Contracts are on hold due to delayed business investment, which itself is being postponed “amid fear of continued recession and ‘ineffective’ government”. This is the opinion of over 1,200 members surveyed by the Institute of Directors (IoD), 44% of whom have postponed at least one investment or hiring decision in 2012 because of economic uncertainty. “If the coalition wants to break this cycle of low economic confidence, then they need to take some bold steps that will make a real difference to the cost and complexity of doing business in the UK,” suggests IoD chief economist Graeme Leach. More...
Contractors facing slowdown in UK manufacturing
Contractors targeting the manufacturing sector for contracts may find new work increasingly harder to secure as the UK’s manufacturing sector experiences a slowdown in the coming quarter. The Confederation of British Industry’s (CBI) Industrial Trends Survey for August shows that domestic and export order books are below normal levels, and this is not forecast to improve over the next three months. “The economic environment for UK manufacturers remains challenging,” explains CBI head of economic analysis Anna Leach, “with domestic demand relatively muted and the ongoing Eurozone crisis now seeming to drag on broader global economic momentum.” More...
Contractors should take heed of HMRC’s success tackling aggressive tax avoidance schemes
Contractors using aggressive tax avoidance schemes should take warning from a series of recent HMRC victories in the courts and tax tribunals. Although still subject to appeal by the scheme providers and taxpayers involved, HMRC’s actions have prevented over £200m from being diverted from the Exchequer. “These wins…send a clear message to tax avoiders – HMRC will challenge tax avoidance relentlessly and we will beat you,” warns HMRC’s director general of business tax, Jim Harra.
Contractors will benefit if household finances improve
Contractors will benefit if the slight improvement in household finances signalled by the Household Finance Index (HFI) for August continues into the autumn. Any increase in consumer spending will have a positive knock-on effect for contractors in both consumer and business-to-business industries. According to this latest index, “households were again less pessimistic about the outlook for their finances over the next 12 months”, a sentiment likely to have been boosted by the index rising for the fourth month running.