Business Entity Tests are not working and should be abolished, says IR35 Forum
Contractors should no longer have to take the Business Entity Tests (BETs) as they don’t work, say the latest IR35 Forum minutes. An IR35 Forum sponsored focus group has determined than the BETs are not fit for purpose, are being incorrectly applied and should be scrapped. “The business entity tests have no basis in case law but have been shown to be misused by client organisations, particularly in the public sector, to determine IR35 status,” highlights ContractorCalculator CEODave Chaplin. More...
Contractors are overpaying tax and ignoring IR35 risk, says a new survey
Two in five contractors are paying more salary than they need to, believing that this will in some way protect them against IR35 risks. A new survey by ContractorCalculator also shows that 98% of contractors know about IR35, and 92% are fairly familiar or better with IR35. “What this survey also shows is that paying a higher salary to avoid IR35 is like wearing a crash helmet and then crossing the road with your eyes shut,” warns Abbott Moore’s James Abbott. “Contractors should be focussing onIR35 best practicesuch as their contract, working arrangements and the business entity tests (BETS).” More...
Contractors could be subject to multiple tax regimes within the UK
Contractors could be paying different rates of corporation and income tax depending on where they are based, and where they are working, following the Scottish referendum result. AccountancyAge’s Richard Crump warns that “as devolution goes the genie is well and truly out of the bottle”, and that further devolution has the “potential for all four of the UK nations to set different tax rules and implement separate business environments”. Crump even goes on to suggest that the UK’s major cities could start to take control of their fiscal regime. More...
Clients using contractors as short-term solution to permanent recruitment issues
Contractors are being hired by clients to fill strategic skills gaps because there are not enough suitably qualified employees to do the job. The latest Recruitment and Employment Confederation (REC) JobsOutlook also suggests that this focus on hiring contractors for their strategic skills is likely to impact on the dynamics of contractor skills profiles required and contract lengths. “It’s clear that skills shortages are affecting the way in which employers use agency workers and increasing numbers are now relying on temporary staff to provide short-term access to strategic skills,” highlights REC CEO Kevin Green. More...
Contractor needs recognised in Labour leader’s speech, but no firm policies revealed
Contractors and the self-employed were acknowledged in Labour leader Ed Miliband’s speech at the Labour Party Conference, but no firm policies for the flexible workforce have yet emerged. “It is encouraging that the Labour leader has recognised the importance of the self-employed and has made this growing sector a key part of his speech,” notes IPSE director of policy and external affairs Simon McVicker. “However, these enterprising individuals must not be burdened by rights in a way that may make them unappealing to their clients. We look forward to hearing more about Labour's plans to help the self-employed.” More...
Oil and gas contractor North Sea prospects buoyed by new production technologies
Oil and gas contractor prospects for future work in the North Sea have received a boost from new production technologies developed by Heriot-Watt University. Production from the North Sea has been steadily declining, which could jeopardise contractor livelihoods. But the new technologies reported by BBC News could make previously uneconomical oil and gas reserves cost effective to extract, prolonging the life of existing fields and generating new contracts from the renewed exploration into currently marginal fields. More...
Contractors could qualify for government cash towards superfast broadband
Contractor limited companies may be eligible for vouchers from the government toward superfast fibre broadband costs. According to Computer Weekly’s Alex Scroxton, small firms in 22 cities that fit the eligibility criteria can apply for financial support towards the installation of fibre broadband from 500 registered suppliers. There is £150m up for grabs, but take-up has been slow and only a fraction has so far been allocated. More...
Contractors may be able to handle their tax affairs by email, believes HMRC
Contractors should be able to communicate with HMRC and handle their tax affairs securely by using email. HMRC’s head of cyber security Edward Tucker told Computer Weekly’s Warwick Ashford that: “HMRC is looking at ways of using secure emails and links, which will have to be backed up with an innovative education to enable taxpayers to identify legitimate emails form HMRC.” Currently, HMRC does not communicate with contractors via email because of spam and security risks. More...
Contractors with manufacturing clients face uncertain future
Contractors working with clients in the UK manufacturing sector enjoyed a good August and September, but are facing an uncertain future. The Confederation of British Industry’s (CBI) latest Industrial Trends Survey shows that activity and contracts in the sector was “solid in the last quarter and expected to strengthen in the next three months”. However, it also warns that “firms saw total order books fall below ‘normal’ levels, and export order books worsened significantly, and are now at their weakest since January 2013”. Now could be a good time for contractors likely to be affected to think strategically about where their next contract comes from. More...
Contractors supplying digital services to the EU can register with new online service
Contractors who supply digital services to consumer customers in the European Union (EU), in addition to their mainstream fee earning activities, can register with a new online VAT service from 20 October. Under new EU rules, from 1 January 2015 the place of supply, and where VAT is levied, is changing to the country where the customer is based, and not where the contractor is located. HMRC’s ‘VAT Mini One Stop Shop’ (VAT MOSS) is designed to reduce the potential administrative nightmare of levying VAT across multiple EU member states. More...