Crackdown on personal service companies could raise £400m in tax

[jamesbrown]

Yep, saw that, but the devil is in the detail.

I think those that genuinely have multiple clients on the go at the same time may escape this - if ClientCo will still be willing to engage them, now that they are on the hook.

Although, I think the number of contractors that really have dual contracts are very low - a few hours in the evening or at the weekend working for someone else won't cut it - the judge ignored that in the Dragonfly case.

Even those that operate multiple clients simultaneously (and I'm one of them) are likely to be caught on some level as the workload is never symmetric between clients (typically very asymmetric) and it changes constantly with client mix and focus. You wouldn't have any basis to set-up and operate a business, because you could be caught during one year (assuming the timeframe is a tax year) and not caught the next year. It would be completely unworkable long-term.

[SunnyInHades]

https://www.youtube.com/watch?v=dMuKRbJa3O8

[BrilloPad]

I remember when Gordon Brown talking about people leaving a company to come back contract doing the same job. It all sounded so innocuous.

The government is determined to kill us off like cockroaches.

When will they start a war on branded companies paying no tax?

[AtW]

Can't believe I voted for them

[jamesbrown]

Some reaction here

[Zero Liability]

We'll see. I think it's going to be a hard sell, and perhaps they may delay implementation until April 2017 to reduce resistance. Even then, they may find big business and their own departments reluctant to just take the hit.

Can't believe I voted for them

I'm glad I didn't, and won't be in the future, either.

[AtW]

We'll see. I think it's going to be a hard sell, and perhaps they may delay implementation until April 2017 to reduce resistance.

Lords won't be intervening on this one and Gideon urgently needs to find a LOT of money quick to make up with delayed introduction of cuts to tax credits.

[Zero Liability]

He won't be getting a lot, as even the contrived figure of £400m will now be less than half that following the dividend tax's introduction. This is a silly way of going about things when they could just tweak that tax, as opposed to angering one of the groups they supposedly represent.

I wonder if it's just the usual tactic of coming up with something obviously barmy and detrimental, to soften resistance to a still ridiculous, but proportionately less so, proposal like the T&S changes, and then pretending to have seen 'reason'. Either way, I'm reserving judgement until I see further details.

[AtW]

I wonder if it's just the usual tactic of coming up with something obviously barmy and detrimental, to soften resistance to a still ridiculous, but proportionately less so, proposal like the T&S changes, and then pretending to have seen 'reason'. Either way, I'm reserving judgement until I see further details.

No.

It's just a very easy target - they will be losing a fair whack of revenue with that promised £50k threshold for 40% tax plus increased personal allowance is costing them, so they need to get as many people as possible into PAYE.

The really evil thing they are going to do is with CGT - obvious not on main house sales, that's a taboo!

[Zero Liability]

Right, but what's £200m or so p.a. going to help? That is notwithstanding any losses in taxes they might suffer on account of the fact that contractors earn higher rates than comparable permies, plus the higher costs govt departments will suffer where they now have to engage permies, who come with an array of fixed costs.