November Budget - Stop Public sector IR35 rules coming into the Private sector

[mattfx]

But invest in what? There's no point in building products in a country where most of the population have no disposable income left to spend...

They have nothing left to spend because every penny is tied up in expensive housing due to an over valued market in need of correction.

... And so the cycle continues on and on.

[bobspud]

I personally support the principle of having lower income taxes to allow people have disposable income, so that they could decide how to spend or save it.

In this case Treasury (who prefers to grab money that it can) would argue that it's a loophole in the system of already high taxation, so it needs to be dealt with, as otherwise it's not possible to reduce corp tax / dividend tax, which might be necessary after Brexit to keep the investment flowing in.

But invest in what? There's no point in building products in a country where most of the population have no disposable income left to spend...

[AtW]

I didn't talk about new cars. I pointed out how you spent money that was left in your pocket.

I personally support the principle of having lower income taxes to allow people have disposable income, so that they could decide how to spend or save it.

In this case Treasury (who prefers to grab money that it can) would argue that it's a loophole in the system of already high taxation, so it needs to be dealt with, as otherwise it's not possible to reduce corp tax / dividend tax, which might be necessary after Brexit to keep the investment flowing in.

[bobspud]

New car sales are collapsing, even before big price increases due to devaluation of sterling.

I didn't talk about new cars. I pointed out how you spent money that was left in your pocket. But seeing as you want to go there:

Now that it costs 35% to pop a deposit out of the company to lease a new toy, How many contractors are going to do that? The government is just so completely broken they cannot see the joined up effects of their short sightedness.

[AtW]

Think about your shiny nice car for a minute. That car was VAT qualifying so leaving you with enough cash in your pockets to be stupid earned them 20% of the sticker price in one afternoon.

New car sales are collapsing, even before big price increases due to devaluation of sterling.

[bobspud]

They'll get more tax if you are forced to be permie: particularly if you are being paid between £100-125k.

Also, and that's overriding concern, they in theory want to reduce corp tax/dividend tax rates/CGT to attract investment, but they can't do it if it costs them in revenue from people who they don't intend to benefit from it

And thats why I am saying that the clarity of thought is broken.

Think about your shiny nice car for a minute. That car was VAT qualifying so leaving you with enough cash in your pockets to be stupid earned them 20% of the sticker price in one afternoon. Then they got some insurance tax and it drinks like me so every few days you need to fill it up oh and theres £1200 in tyres that you will need to buy every few thousand miles lets take the 20% vat for those too...

all of that behaviour drives other businesses that report a profit and pay more taxes...

Compare that with handing over an additional £30k in direct tax only to see it vanish into an offshore account because HMRC needed to pay their landlords for their leaseback of their offices...

[AtW]

and this is where clarity of thought falls flat...

Under the old system if I had a profit of £100000 at the end of the year I would set aside 20% and apportion a dividend that would accrue roughly 2k in capital gains tax each I will have also collected and passed on probably 26k in VAT so my fair share of taxes was

20k corporation tax
26k VAT
4k personal taxes

They'll get more tax if you are forced to be permie: particularly if you are being paid between £100-125k.

Also, and that's overriding concern, they in theory want to reduce corp tax/dividend tax rates/CGT to attract investment, but they can't do it if it costs them in revenue from people who they don't intend to benefit from it

[AtW]

But its obviously not a zero sum game as otherwise they would not need to collect it.

It's zero some game between two VATable businesses, think about it for a moment - if you are big enough to collect it, then whoever can afford your services will have to be big enough to pay you - VAT registered.

[bobspud]

Once again please, please don't quote or include VAT when showing how much tax we pay..

VAT is regarded by HMRC as cost neutral for most B2B businesses as what we pay in VAT would otherwise have been paid by our customer (yes the public sector and banking is slightly different but only banking can't claim the money back)..

But its obviously not a zero sum game as otherwise they would not need to collect it.

[eek]

26k VAT

Once again please, please don't quote or include VAT when showing how much tax we pay..

VAT is regarded by HMRC as cost neutral for most B2B businesses as what we pay in VAT would otherwise have been paid by our customer (yes the public sector and banking is slightly different but only banking can't claim the money back)..