With the dividend taxation will you continue contracting?

[unixman]

Yep just up my rate. Clients or agent will absorb it

Hear, hear. When costs increase, don't think you must absorb the increase. Does British gas absorb increases in costs? No, it does not. Just explain to the agent patiently and politely, and let them do the rest. At least they know you aren't making it up.

Who knows, it might even mean clients give more weight to local contractors. So I don't commute to Liverpool while a scouse contractor stays in a Travelodge 2 miles from my house.

[barrydidit]

So I don't commute to Liverpool while a scouse contractor stays in a Travelodge 2 miles from empties my house.

ftfy

[Whorty]

What fooks me off is I consider myself a consultant, as I do the same work now as I did when I worked for a big 4 consultancy. The big 4 though see us little guys as a threat as we do the same job but for 25% of the cost to the client. And what do they do with threats, they pressure the government to get rid of us.

It probably cost the big 4 quite a bit to buy these changes from the tories/HMRC, but they will get that back and more once we are out of the way and they can charge the clients more dosh.

I still work on a lot of projects where big 4 consultants are also involved, and they have to bring in cheap bob-consultants these days as Brits down want to deal with their tulip, and we are too expensive to hire

[WordIsBond]

And with it a drop in rate?

I doubt too many contractors would agree to that

Why? If you have costs of £500 / week, what difference does it make whether you make £500 / day or £400 / day with expenses paid?

If the latter means a lower tax bill, I'd agree to it in a heartbeat.

[WordIsBond]

As a contractor-turned-business-owner interviewing me for a permie role once said: "Once a contractor, always a contractor."

I predict two trends over the next couple of years to balance this:

1) Market Rate *= 1.05
2) Contracts have to be IR35-Friendly by default

And....

Since they are talking about shifting some of the IR35 burden onto end clients, 2) may get a lot easier to accomplish.

[TheLordDave]

Hear, hear. When costs increase, don't you must absorb the increase. Does British gas absorb increases in costs? No, it does not. Just explain to the agent patiently and politely, and let them do the rest. At least they know you aren't making it up.

Who knows, it might even mean clients give more weight to local contractors. So I don't commute to Liverpool while a scouse contractor stays in a Travelodge 2 miles from my house.

That's all well and good but unless it's a blanket increase by all contractors you will just price yourself out of work.

[Zero Liability]

And....

Since they are talking about shifting some of the IR35 burden onto end clients, 2) may get a lot easier to accomplish.

Which is why I don't expect it. I think this may end up being an implicit abolition of it, and replacement of it with something else which will retain the name but effectively amount to a device like the FLC. They have the means now to separate out what they call "PSCs" and charge them a differential rate of dividend taxes relative to other ltds, so that option is open, and is a lot less messy than what they currently do.

I mean it could happen, I just think the government would have to be very charitable or myopic for it to occur. Same goes for simply "beefing" the measure up, it won't accomplish much as its cost-efficiency won't improve, and they have other "tools" at their disposal compared to this archaic, unwieldy measure.

All one can do is wait and see. Hopefully IPSE is going to get very involved in these discussions, but if the government doesn't want to listen, it won't.

[Archangel]

I stopped contracting in 2009 and bought a "proper" business with staff and all that. This affects me too as I use the low salary c/w dividends route. Although it is a little mitigated by the increase in the employment allowance and the reduction in ct rate I'm still out of pocket. I'm sure I'm not the target, but I'm still the victim

Twats

[SpontaneousOrder]

If it were that easy, you'd be charging that rate already

Exactly

[SpontaneousOrder]

Utter bollocks a contractor will change rates regularly within a range depending on other factors, and clients offer a wide range of rates. Or do you have your rate tattooed onto your forehead

Recommend for you:

Basic Economics: A Common Sense Guide to the Economy: Amazon.co.uk: Thomas Sowell: 9780465002603: Books