End of IT contracting this June?

[LondonManc]

It really depends how they proceed post Taylor. If the PS rules are extended to the private sector, I tend to agree (although there will still be a large number of companies whose approach to risk/compliance will dictate caution). If they opt for a statutory definition of self employment (which I support, in principle, and see as increasingly likely in practice), there won't be nearly the same scope for fudging/subjectivity.

Let's not forget that this covers far more than IT contracting in the private sector - Uber, Deliveroo, Mitie, plumbers, engineers, all sorts. Some industry sectors may be far more clear cut than others.

[SueEllen]

It really depends how they proceed post Taylor. If the PS rules are extended to the private sector, I tend to agree (although there will still be a large number of companies whose approach to risk/compliance will dictate caution). If they opt for a statutory definition of self employment (which I support, in principle, and see as increasingly likely in practice), there won't be nearly the same scope for fudging/subjectivity.

The Tories will get pressure from their party donors who tend to be directors of large companies so there will be some sort of fudge.

After all Camoron had his fingers in the pie concerning Uber in London. This is the link for those who don't know what I mean - linky. It was reported first in the Daily Mail and picked up by the FT and some other outlets.

[jamesbrown]

The Tories will get pressure from their party donors who tend to be directors of large companies so there will be some sort of fudge.

After all Camoron had his fingers in the pie concerning Uber in London. This is the link for those who don't know what I mean - linky. It was reported first in the Daily Mail and picked up by the FT and some other outlets.

Yeah, but Hameface's chumocracy is antithesis to May. They approach things very differently. I think May has already demonstrated that she's willing to consider ignoring big business, although Parliamentary realities have dictated a lot of back-peddling on the more Millipedesque suggestions (workers on boards etc.). With a little care though (), what we're talking about here really doesn't carry the same risks as the NI debacle, and I can see there being broad support if it's carefully packaged as anti-avoidance.

[TheFaQQer]

I guess "they" don't understand that a company would hire a contractor for an engagement and accept the £100,000 cost but wouldn't hire someone and pay them the same rate, it would be significantly lower to cover all the guff that goes with employing a permie.

That is very much an argument that HMG and certain think tanks choose to ignore.

As a percentage, the owner-director limited company contractor is likely to pay lower tax than someone earning the same wage as an employee. The message that gets lost no matter how loud anyone shouts it is that the employee does NOT get the same wage as the contractor, and so the likelihood is that the net contribution to the economy made by the contractor (and their limited company) is much higher than the contribution that the employee makes.

I left my last permie job where I earned around £35k and took a contract paying £400 a day, which meant that I paid significantly more into the public purse as a contractor than I ever did as an employee.

[VectraMan]

I left my last permie job where I earned around £35k and took a contract paying £400 a day, which meant that I paid significantly more into the public purse as a contractor than I ever did as an employee.

If the employer/client is having to pay more for someone has an economic and tax effect too. If the employer's CT bill is reduced by paying more for a contractor than an employee, and the contractor is able to pay a lower tax percentage than the employee, then overall that's a tax loss for the government.

[LondonManc]

If the employer/client is having to pay more for someone has an economic and tax effect too. If the employer's CT bill is reduced by paying more for a contractor than an employee, and the contractor is able to pay a lower tax percentage than the employee, then overall that's a tax loss for the government.

What you've missed, though, is the ancillary impact of the contractor's disposable income - posh coffees, better restaurants, generally an extra 20-30k having an impact on the wider economy and the ripple effect which it creates.

[SueEllen]

Yeah, but Hameface's chumocracy is antithesis to May. They approach things very differently. I think May has already demonstrated that she's willing to consider ignoring big business, although Parliamentary realities have dictated a lot of back-peddling on the more Millipedesque suggestions (workers on boards etc.). With a little care though (), what we're talking about here really doesn't carry the same risks as the NI debacle, and I can see there being broad support if it's carefully packaged as anti-avoidance.

I presume you didn't see the housing white paper? It was a chance to stop landbanking and either temporary/permanently increase the tax take, but the Tories under May decided to keep the status quo.

[SueEllen]

What you've missed, though, is the ancillary impact of the contractor's disposable income - posh coffees, better restaurants, generally an extra 20-30k having an impact on the wider economy and the ripple effect which it creates.

Lots of politicians now don't believe in the trickle down effect economic theory due to the increase in income inequality in Western economies like the UK and US.

[LondonManc]

Lots of politicians now don't believe in the trickle down effect economic theory due to the increase in income inequality in Western economies like the UK and US.

The politicians don't believe anything that doesn't suit their agenda.
HTHBIDI

[jamesbrown]

I presume you didn't see the housing white paper? It was a chance to stop landbanking and either temporary/permanently increase the tax take, but the Tories under May decided to keep the status quo.

Indeed, but I also mentioned the political realities. It comes down to the degree of pushback, and I would not expect a large pushback on measures that are wrapped as "anti-avoidance". This is most definitely not a re-run of the NI debacle. We are not the "self-employed" as perceived by the mainstream press. Remember, the Tory backbenchers don't want to rebel for the sake of it. They know division projects incompetence (witness Labour).