New ‘off-payroll rules’ could force contractors into PAYE, or out of work
Limited company contractors with public sector clients are facing a crackdown on their arrangements following the introduction of new ‘off-payroll’ rules. HM Treasury’s new rules say that individual government departments will be required to seek assurances that contractors earning over £220 a day and on contracts lasting more than six months are paying the correct amount of tax. The Treasury’s rules also urge departments to “consider terminating the contract if that assurance is not provided”. An estimated 2,400 contractors will be affected, 40% of them IT contractors. More…
New checklist for contractors to identify their best fit online accountancy service
ContractorCalculator’s new, free checklist allows contractors to profile and select the online accountancy service that best suits their needs. Developed in association with Brookson, Crunch and FreeAgent, the checklist enables contractors to identify the specific features and benefits of most use to them and their business. Those with an existing accountant can choose an online accountancy software service without an accountancy component, which is designed to complement their own accountant’s services. Alternatively, the checklist can help to identify those service providers who offer a comprehensive and integrated accountancy service alongside the online software. More…
Contracting disciplines top skills shortages list, reveals REC JobsOutlook
Contractor clients are “predicting they would have difficulty finding the skilled staff they need in the areas of engineering and technical skills and computing, IT and telecommunications over the coming year.” This is according to the Recruitment and Employment Confederation’s (REC) JobsOutlook survey for May, which also reports that “26 percent [of clients] say they will increase agency workers over the next 3-12 month period with 59 percent saying they will maintain their current numbers.” REC Director of Research Roger Tweedy says: “Demand for staff is higher in certain sectors and bosses tell us that despite the current rate of unemployment, they still predict they will find it hard to fill the vacancies they have for engineers and skilled IT and technical staff.”
Skills survey reveals ‘skills potholes’ that contractors can fill
After skilled trades occupations, contracting disciplines such as IT, engineering, interim management, finance and accountancy and media are unable to fill up to a fifth of vacancies due to a shortage of suitably skilled, qualified and experienced candidates. The UK Commission for Employment and Skills Survey 2011: UK Results highlights that that the UK economy “cannot return…to positive growth and global competitiveness without the unique actions of highly trained and skilled people”. The report defines ‘skills potholes’ as “areas, sectors or occupations which are suffering from deep, painful and persistent skills gaps.”
IT dominates a Scottish labour market showing growth outpacing the rest of the UK
IT and computing topped the Scottish demand league tables for both permanent and contract work in April. The Bank of Scotland Report on Jobs also highlights an increasing shortage of contractors in general, and engineers in particular. Contract and temp billings by agencies increased during April, in contrast to five consecutive months of falls in the UK as a whole. Scotland may present an attractive contract market for contractors with the right skills currently based elsewhere in the UK.
Cutting 3,300 HMRC jobs led to £1.1bn in lost revenues, say MPs
The Commons Public Accounts Committee has criticised HMRC for failing to close the tax gap, citing staff cuts as a contributing factor. According to the Chair of the Committee of Public Accounts Margaret Hodge. “There is at least £35bn outstanding in uncollected tax. HMRC could have collected a further £1.1 billion had it not cut its staff numbers by more than 3,300 over the lifecycle of the programme.” Unfortunately for contractors, HMRC’s staff cuts do not appear to extend to its IR35 compliance teams. Hodges’ subsequent remarks suggesting that public servants have used managed service companies to avoid tax highlights a worrying basic lack of knowledge about taxation shown by the committee’s members. More…
Boost to oil and gas contractors’ prospects from record breaking North Sea licensing round
Oil and gas contractors have received a huge boost to their prospects following a record breaking North Sea licensing round. A total of 224 applications have been made for new exploration zones on the UK Continental Shelf, the largest number since licensing began in 1964. The strong interest suggests that the appetite for North Sea exploration is still strong. Increased oil and gas exploration in the North Sea will result in a greater number of contracts for contractors across many disciplines. More…
Weakening manufacturing sector may dampen contract opportunities
Contract opportunities with manufacturing industry clients may start to dampen as output in the UK sector begins to weaken. The Confederation of British Industries’ (CBI) monthly Industrial Trends Survey shows falling domestic demand for UK produced goods, and the slightly above average export demand is failing to compensate. “Domestic demand for manufacturers’ goods has eased this month, leading to an expectation among firms that growth in production will slow sharply over the coming quarter,” explains CBI Chief Economic Advisor Ian McCafferty. More…
Contractors could be £8,400 a year better off under a single 30% income tax
Contractors in a two-earner household with an income of around £28,000 would receive a tax cut of around £3,400 and would benefit from an additional £5,000 per family, according to changes to taxation proposed by the 2020 Tax Commission. A joint project between the TaxPayers’ Alliance and the Institute of Directors (IoD), the commission claims that merging National Insurance Contributions and income tax into a single income tax rate of 30%, raising the personal allowance to £10,000 and other wide reaching tax reforms would significantly increase the UK’s economic growth, and contractors’ net pay. More…