Autumn Statement 2016

[Antman]

Well exactly. That's what I meant by all people doing it. Works for unions.

I know I will be asking a higher rate, my skills are quite specialist so there won't be so much competition.

The second sentence directly contradicts the first. Unions negotiate for all their members, although you're alright, how does that help those who don't have your specialist skills?

Or was that an irony alert that I completely missed?

[seeourbee]

It's different for different industry I think. With IT you can (possibly) offshore. You can't in mine. And besides off shoring in PS is contra Government Policy.

So if everyone dug their heals in it still works. Your first suggestion is using a just a few.

I agree it's hard, but it could be effective.the premium doesn't need to be ridiculous either, just enough to balance back to pre changes levels.

[seeourbee]

The second sentence directly contradicts the first. Unions negotiate for all their members, although you're alright, how does that help those who don't have your specialist skills?

Or was that an irony alert that I completely missed?

I meant I will have to ask for higher rates as I can't see others contributing to the union approach. IPSE could help here, if they weren't useless.

[vetran]

It's different for different industry I think. With IT you can (possibly) offshore. You can't in mine. And besides off shoring in PS is contra Government Policy.

So if everyone dug their heals in it still works. Your first suggestion is using a just a few.

I agree it's hard, but it could be effective.the premium doesn't need to be ridiculous either, just enough to balance back to pre changes levels.

If the premium becomes significant the Government relax ICTs. They have no wish to pay a premium and despite most people's opinion there are plenty of good IT people in India etc who fancy working in UK.

[seeourbee]

Autumn Statement 2016

ICT ? Perhaps that how it will be for IT industry, I don't know. But it is directly against Gov. Policy like I said.

The premium does t need to be significant, just a rectification

[MrC]

For somebody who isn't IR35 caught or doesn't do public sector work there are still a number of advantages to operating as a Ltd co, particularly the tax planning advantage of not having to draw dividends above the higher rate threshold unless you need to.

If you were on PAYE or self employed you'd be taxed at the higher rate on any earnings above the threshold immediately and would have to build a war chest up out of post-tax money.

Isn't there still a significant reduction in NI paid under a ltd? I know the dividend tax grab eats into things but thought still left an overall benefit?

Also in NI -there was mention of equating employee and employer NI. Apparently at no cost to employees and only costing employers an extra £7/year. Either I misunderstood or hamster is talking gibberish since this makes little sense looking at the numbers. Can anyone clarify?

[seeourbee]

Technically NI is still beneficial but all the other taxes (CT, Divi etc) now bring the bottom line to the same. It's only the bottom line that counts.

[lucyclarityumbrella]

Also in NI -there was mention of equating employee and employer NI. Apparently at no cost to employees and only costing employers an extra £7/year. Either I misunderstood or hamster is talking gibberish since this makes little sense looking at the numbers. Can anyone clarify?

They have simply raised the Lower Limit for Employers NI to £157 from £156 which puts it in line with Employees NI thresholds, what they cease to shout about is that they have altered the upper earnings threshold from £827 to £866. In a nutshell, contractors are likely to be paying more of their contract rate at 12% for Employers NI and less at the 2% for the top end. Nicely kept quiet!

[TheCyclingProgrammer]

Isn't there still a significant reduction in NI paid under a ltd? I know the dividend tax grab eats into things but thought still left an overall benefit?

Yes, there is still a saving despite the dividend tax increase.

Also in NI -there was mention of equating employee and employer NI. Apparently at no cost to employees and only costing employers an extra £7/year. Either I misunderstood or hamster is talking gibberish since this makes little sense looking at the numbers. Can anyone clarify?

Haven't looked into the details but the gist I got was that we might have some additional employer's NI to pay, depending on our salary level and eligibility for the employer's NI allowance.

[d000hg]

Catching up on the thread...

I believe you have spectacularly missed the point, lets consider a £600 day rate, certainly not unusual in the city .

Double Doh!!!! whooosh.

Got it now, thanks

So, the thing they introduced to simplify VAT, they effectively want to take away, I should have known

So the only thing that changes is under FRS we pay 16.5% VAT not 14.5% and the FRS profit we make is reduced. IIRC under FRS we pay 14.5% of the invoice total inc VAT so if I bill £1000+VAT (£200) to my client that makes the VAT 14.5% of £1200 => £174. Your FRS profit is:

(NET * 0.2) - (0.145 * NET * 1.2) => FRS profit percentage is 2.6% currently?

And increasing 14.5 => 16.5 your FRS profit is .2%?

So a £400/pd contractor planning to bench for 12 weeks per year may as well de-register from VAT?

I don't think so. There's still value in being able to recover VAT costs on the stuff we do pay for and our clients can reclaim the VAT we charge them so other than the admin, you're still better off being registered.

I can't see any case where pulling out of VAT entirely is beneficial? Deregistering from FRS certainly as you can get £20 off your accountant bill every month for a start, but why deregister from VAT if you are able to?

You put your lunch through on expenses!!!?

Don't you ?

I thought contractors took a 5-minute lunch break at their desk so they could leave early...