Originally posted by LondonManc
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Will contract rates increase to pass dividend tax increase to clients?
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Originally posted by NibblyPig View PostDepends if contractors are leaving the contracting business, or contractors are turning down lower paying roles.
Plus don't forget T&S changes that may make contractors turn down roles further afield which reduces supply and drives prices up.
All speculation though. Will have to wait and see.'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
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Originally posted by jamesbrown View PostWhat is a "huge amount" in the context of applying full PAYE and NI through a Ltd or being a sole trader? It wouldn't have to go much further to eliminate the difference entirely. There's a limit to how far they can push the dividend tax. It's a very poor mechanism through which to eliminate tax-motivated incorporation (given the wider use of dividends). On the contrary, this was mainly intended as a source of revenue, with the distributional impacts on particular taxpayers (us) as a secondary benefit. It may go somewhat further, but it cannot go substantially further.
My point being that if we accept 7.5% as ok, will there be an argument against it going up to 10% next year, 12.5% the year after, etc?Comment
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Originally posted by pr1 View PostWell 15% would match the employee NI "avoidance" - I can definitely seeing it creeping up to that over the next 5-10 years
My point being that if we accept 7.5% as ok, will there be an argument against it going up to 10% next year, 12.5% the year after, etc?Comment
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Originally posted by jamesbrown View PostAs I say, the dividend tax is a blunt tool, the perceived tax gap has now been narrowed, and we're not the only pips that will squeak as we approach 2020 (it impacts a reasonable fraction of the retired Tory base). I think this was motivated by revenue, not principle. However, it's difficult to maintain an argument that low rates of taxation increase overall tax income (as in Gidiot's 8bn assertion about reducing additional rate tax) while also increasing tax rates. That said, I think this will be cleared-up pretty soon, depending on what they do w/ IR35, because IR35 becomes moot if dividends are fully aligned with employment income.The greatest trick the devil ever pulled was convincing the world that he didn't existComment
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When IR35 came in, there were many saying "that's it, most contractors will go back to permiedom". Didn't happen and won't happen this time.Down with racism. Long live miscegenation!Comment
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Originally posted by NotAllThere View PostWhen IR35 came in, there were many saying "that's it, most contractors will go back to permiedom". Didn't happen and won't happen this time.'CUK forum personality of 2011 - Winner - Yes really!!!!Comment
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Originally posted by jamesbrown View PostAs I say, the dividend tax is a blunt tool, the perceived tax gap has now been narrowed, and we're not the only pips that will squeak as we approach 2020 (it impacts a reasonable fraction of the retired Tory base). I think this was motivated by revenue, not principle. However, it's difficult to maintain an argument that low rates of taxation increase overall tax income (as in Gidiot's 8bn assertion about reducing additional rate tax) while also increasing tax rates. That said, I think this will be cleared-up pretty soon, depending on what they do w/ IR35, because IR35 becomes moot if dividends are fully aligned with employment income.
Tory's have introduced it but that doesn't stop anyone else cranking it up as soon as they get the chance
Agreed IR35 becomes moot if they push it up enough, maybe that's HMG/HMRC's long term solution to IR35, saves all the investigations and court time and money, and the risk (& associated implied cost) of losing big cases like arctic systems*
*yes it wasn't an IR35 case but it's a big case that was lost that has massive cost implications to HMRCComment
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Originally posted by LondonManc View PostIf it's motivated by revenue, not principle, why "apologise" to us through corporation tax cuts?Comment
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Originally posted by jamesbrown View PostMost small businesses don't pay CT. We do, of course, but this policy announcement has nothing to do with us. It is squarely aimed at increasing FDI and UK incorporation by foreign multinationals, part of the international race to the bottom. Again, the logic is that lower rates build a larger pie.Comment
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