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

[diseasex]

If this comes in, there's going to be lots of massive houses on the repossession market if they don't have a plan b....

I'll be on buyers side then.

[d000hg]

If this comes in, there's going to be lots of massive houses on the repossession market if they don't have a plan b....

Don't be silly, contractors buy for cash.

[I just need to test it]

If I was a few years younger and had a bit more appetite for staying in this contracting game another 15 years I might splash out on a camper van.

[_V_]

Don't be silly, contractors buy for cash.

From my experience, most contractors don't buy with cash, when their house cost well over a million quid. They instead have eye watering mortgages and lots of worry lines.

[ShandyDrinker]

Someone said, on here, there has been a 30% drop in computer related university course uptake, this year.
Doomed

Its something I have been going on about for the last 10 years, I can't believe IT is not been promoted as an option.

Why would you take a computer related university course? Traditionally any Computer Science related course had one of the highest graduate unemployment rates (see articles such as this).

This combined with the low barrier to entry for anyone entering IT make competition for roles huge. We're also competing with people from the rest of Europe and further afield for roles in our own country although this is a discussion for a different thread.

Although I have seen encouraging signs over the last 10 years, IT and software development in particular seem to have a real issue with ageism. Not surprising when younger people are so willing to be exploited as they think it will help their careers.

Given all of the above, is the drop in people applying for University courses really that much of a surprise!?

[Tasslehoff]

"
George Osborne would risk a revolt from his own parliamentary colleagues if Autumn Statement 2015 contains a reported plan to ban PSC contracting for more than a month.

In fact, “a number of politicians” would likely challenge the chancellor if he unveils the ‘one-month-then-payroll’ clause on November 25th, says the Freelancer & Contractor Services Association.

The employers’ group, the CBI, which will apparently have a say on the reported plan at its annual conference this week, would likely object too, believes FCSA chair Julia Kermode.

“There are some 4.6m self-employed workers in the UK who will have to go on the payroll of each of the clients they work for after a month if this [reported] legislation comes into force,” she said.

“That is a huge administrative burden for UK plc who will suddenly find themselves having to deal with a significant amount of workers on the payroll”.

Kermode spoke of the “statutory benefits” which, presumably, would accrue and be payable to the worker by the employer, in the event that 'off-payroll' PSCs become taxed like 'on-payroll' employees.

The Association of Independent Professionals and the Self-Employed says it is urgently trying to clarify whether an effective ‘one-month’ cap on contracting is “under serious consideration.”

“This would make operating a freelance business almost impossible in many instances, and would cause untold damage to the flexible economy,” warns IPSE chief executive Chris Bryce.

“This measure was not contained within the government’s original consultation documents and has not been raised by the government with stakeholders in its regular IR35 Forum meetings.”

But nasty surprises are what the contractor industry has had to get used to, and more ‘devil in the detail’ is likely - even if the one-month cap comes to nothing, a services provider said last night.

It warned: “[We] don't think anything will be said of much interest to contractors and how they are paid in the Autumn Statement. Eyes should be on the 2016 Finance Bill and not just the amendments we know about”.

However, another services provider says the current concern about how contractor pay levels will suffer under the chancellor’s proposals – like the new dividend tax and ‘SDC’ or the ‘one-month cap’, is misguided.

Carolyn Walsh, a director at CWC Solutions told ContractorUK: “Many organisations that represent or provide services to contractors…have said that they believe they will suffer losses and that contracting 'won't be worth it in future'.

“But if perceived losses are down solely to paying more tax in future, that's not really a business issue, more a concern over take-home pay and I propose that this is a counter-productive argument.

“In practice, genuine business-owners concern themselves with gross profit; being overly concerned with net pay could leave some contractors with a question mark hanging over their contractor status if a more business-like approach to the expected changes is not taken.”

The FCSA suggests that such a question mark is already there - at least in the Revenue’s eyes.

“HMRC is intent on ‘making IR35 more effective’” said Ms Kermode. “[This] means collecting more tax for the chancellor and levelling the field between [an employer’s] direct employees and their workers.

"It's an utter nonsense and from discussions I have had with a number of politicians there is no political will to support Osborne on this move - I cannot see the CBI being in favour of it either."

She added: “We are very worried that hirers will simply not engage freelancers and contractors at all which will defeat the whole purpose of a flexible freelance workforce which is enabling businesses to be agile – it is unthinkable that government might be prepared to jeopardise this with an ill-thought-through move."

Osborne warned against a cap on contracting :: Contractor UK

[MrMarkyMark]

Why would you take a computer related university course? Traditionally any Computer Science related had one of the highest graduate unemployment rates (see articles such as this).

This combined with the low barrier to entry for anyone entering IT make competition for roles huge. We're also competing with people from the rest of Europe and further afield for roles in our own country although this is a discussion for a different thread.

Although I have seen encouraging signs over the last 10 years, IT and software development in particular seem to have a real issue with ageism. Not surprising when younger people are so willing to be exploited as they think it will help their careers.

Given all of the above, is the drop in people applying for University courses really that much of a surprise!

Interesting, I must admit I didn't know it was that bad.
Looks like the only way to solve this would be more apprenticeship type schemes, however it looks like all those opportunities are offshore, according to that article.

[ShandyDrinker]

Interesting, I must admit I didn't know it was that bad.
Looks like the only way to solve this would be more apprenticeship type schemes, however it looks like all those opportunities are offshore, according to that article.

In a way I think you miss my point. Apprenticeships will not solve the problem. IT is in many ways unique (as opposed to something like Accountancy) in that you are constantly having to learn new technologies to stay current. While with accountancy there will be new legal requirements, the fundamentals will not change massively in a short timeframe. With IT there is often a necessity to throw away large chunks of what you know and learn something new all the time.

With any of the professions you have to pay, train and qualify thus having a barrier to entry and keeping the numbers low. IT just doesn't have that.

I find it encouraging that young people are becoming savvy as to what they are studying and working out that the return on investment in a career in IT may not be as good as for other things.

[MrMarkyMark]

In a way I think you miss my point. Apprenticeships will not solve the problem. IT is in many ways unique (as opposed to something like Accountancy) in that you are constantly having to learn new technologies to stay current. While with accountancy there will be new legal requirements, the fundamentals will not change massively in a short timeframe. With IT there is often a necessity to throw away large chunks of what you know and learn something new all the time.

With any of the professions you have to pay, train and qualify thus having a barrier to entry and keeping the numbers low. IT just doesn't have that.

I find it encouraging that young people are becoming savvy as to what they are studying and working out that the return on investment in a career in IT may not be as good as for other things.

There are some IT internships though, I had one working with me the other summer.
The bank, concerned, then took him on full time, so they do exist.
It may be that these only exist for potential roles that cannot be offshored, however.

I don't agree with the throwaway statement completely, either, as most IT can be joined up in such a way, that understanding one thing, can shortcut you to understanding another.

[rl4engc]

I've not found any of that (lots of competition, ageism etc.) Indeed I get the impression (at least in the roles I've been in) that agents struggle to find suitable candidates. At one gig I got I was informed that one of the two people put forward before me could hardly speak a word of English!

At another Permie interview they offered me the job, I refused as I didn't like the vibe of the place, and they kept coming back basically trying to change the spec to one that would suit me.

Also I see loads of "Graduate XYZ" roles, where XYZ is any IT role that they just want to shove a Graddy in and train up, I'm assuming with little success.