Autumn Statement 2016

[youngguy]

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!

So we pay div taxes , pay more ni, pay more taxes and get less from FRS.

What did we do to p*ss this Gov off so much?!

I await the calculators postdoc 5th to tell me just how much worse offer all are.....gulp

[lucyclarityumbrella]

And that's without us knowing the minute detail of what they referred to as addressing "the cost of incorporation!" Anyone fancy a guess as to what they are hinting at?

[seeourbee]

Is that why that reporter from The Times is reaching out ??

[TheCyclingProgrammer]

And that's without us knowing the minute detail of what they referred to as addressing "the cost of incorporation!" Anyone fancy a guess as to what they are hinting at?

The optimistic side of me would like to think they are referring to things like the dodgy scam certain agencies are running by setting their temps up as two man companies to claim the employers allowance.

[MPwannadecentincome]

I am confused about the abolishing of mobile phone salary sacrifice thing... does this mean that personal use of a company mobile phone is now taxable?

[northernladuk]

I am confused about the abolishing of mobile phone salary sacrifice thing... does this mean that personal use of a company mobile phone is now taxable?

Do you sacrifice salary to get a mobile or is it a business expense?

[MPwannadecentincome]

Do you sacrifice salary to get a mobile or is it a business expense?

Phone is on business tariff paid for by company so business expense, but I understand current rules allow personal usage without re-imbursement by myself personally and without any personal tax liability. TBH I didn't know there was a phone salary sacrifice scheme so no idea if that was different or not?

[northernladuk]

Phone is on business tariff paid for by company so business expense, but I understand current rules allow personal usage without re-imbursement by myself personally and without any personal tax liability. TBH I didn't know there was a phone salary sacrifice scheme so no idea if that was different or not?

What did your accountant say?

[TheCyclingProgrammer]

I am confused about the abolishing of mobile phone salary sacrifice thing... does this mean that personal use of a company mobile phone is now taxable?

Only if you take a salary sacrifice to pay for it.

[d000hg]

Correct. 16.5% x 1.2 (regular VAT multiple) = 19.8%. Thus, the saving is 20%-19.8%=.2%.

But as CP has pointed out, accountancy fees alone would wipe that out. In short, there is no longer a cost saving (indeed, there is likely to be a net cost), but you could argue that the FRS wasn't intended for this, only to simplify accounting.

I don't have a problem with not making money from VAT, looks likely we'll all just ditch FRS then?

So we pay div taxes , pay more ni, pay more taxes and get less from FRS.

What did we do to p*ss this Gov off so much?!

We paid a lot less tax than most people earning similar amounts. So that's an easy way for HMRC to get some more money knowing we can't really kick up too much of a fuss lest we get headlines "£100k contractors complain about having to pay tax like everyone else"

Our income being taxed in a way broadly inline with permies earning similar amounts is reasonable IMO, I don't want to pay the extra of course. The fear seems to be they might continue to ramp up our taxes (divi tax, etc) so we're relatively worse off than permies e.g. IR35, expenses claims, etc.