Hammond plans tax crackdown on 'synthetic self-employed'

[legal]

Hammond plans tax crackdown on 'synthetic self-employed' - BBC News

Nothing new but time to take this seriously now?

The Treasury is finalising plans to overhaul tax rules which allow self-employed people to avoid paying national insurance contributions.

The move will be targeted at people who set themselves up as private companies to take on work.

It could be announced in the Budget at the end of the month, I understand.

[swamp]

This is great news!

Most clients will simply put declare thier contractors outside IR35.

If they don't, then the good ones will jump ship. And the others will litigate for employment rights.

[jamesbrown]

he tried it 2 years ago and failed as it was directly in opposition to a manifesto item.
I don't recall they changed that bit of the manifesto for the last GE. If the manifesto wasn't changed he's not doing it again as it nearly cost him his job.

Sure he will. The public sector reforms were announced in 2016. The private sector reforms will happen too.

This issue doesn't have nearly the same resonance as the proposed hike to Class 4 NI that was scrapped - there's no "white van man" angle w/r to IR35. If anything, the optics are reversed.

EDIT: OK, I see you deleted your post - I guess you misread or something. Fair enough.

[Lance]

Sure he will. The public sector reforms were announced in 2016. The private sector reforms will happen too.

This issue doesn't have nearly the same resonance as the proposed hike to Class 4 NI that was scrapped - there's no "white van man" angle w/r to IR35. If anything, the optics are reversed.

EDIT: OK, I see you deleted your post - I guess you misread or something. Fair enough.

I thought the OP was on about the change to NICs that he tried previously. Then I read the article.... My bad.

[frustin]

This is great news!

Most clients will simply put declare thier contractors outside IR35.

If they don't, then the good ones will jump ship. And the others will litigate for employment rights.

Is it really great news? why wont affect people in contract positions already?

[Matt88]

This is great news!

Most clients will simply put declare thier contractors outside IR35.

If they don't, then the good ones will jump ship. And the others will litigate for employment rights.

I think you've not been an employee for so long, you forget how businesses are run. They follow all legislation! Religiously! And they'll start scrutinizing everyone they hire, and ensure their hires are following IR35 to the letter of the law.

In fact, they'll probably go overboard and only hire contractors who adhere to IR35 I imagine.

£35k a year employees, earning £100k+ a year, was never really sustainable. I know it's fantastic for you, because there's no chance in hell you'd ever earn a really high salary as an actual employee, but why on earth are the people in the government just turn a blind eye to all this stuff.

You had a nice run, and I'm sure you think you're something special, but you're not. You're people who would be earning £30-40k if you were an employee. So why on earth should you earn double that (a lot of which is tax avoidance) just because you have to pay your own pension, and holiday pay.

IT Contractors should be earning e £50k a year max. That compensates them fully for the pension, holiday pay, health insurance, sick pay

[Matt88]

Sure he will. The public sector reforms were announced in 2016. The private sector reforms will happen too.

This issue doesn't have nearly the same resonance as the proposed hike to Class 4 NI that was scrapped - there's no "white van man" angle w/r to IR35. If anything, the optics are reversed.

EDIT: OK, I see you deleted your post - I guess you misread or something. Fair enough.

The previous attempt was related to raising tax. A completely different optic.

Making sure businesses and contractors follow the law (IR35) is quite reasonable. And I doubt anyone will shed any tears for those trying to circumnavigate the law

[jamesbrown]

Is it really great news? why wont affect people in contract positions already?

I hardly think it could be described as great news, but there's also a degree of unpredictability about how the private sector will respond vs. the public sector.

Presumably, a large chunk of BoS contractors will be evaluated negatively and will need to switch to umbrella or apply the deemed payment or clients will switch to employed FTC for those roles. For those that bridge the change with existing contracts and are evaluated negatively, the greatest risk is presumably to their prior status.

Another large chunk will likely benefit from the change as clients become more aware of the need to demonstrate their truly outside requirements as outside.

A smaller number (some who post on this board) have seen this coming for a while and have already made plans of various types.

[fiisch]

I'm unconvinced Hammond will get this to pass in Parliament - presumably this would have all sorts of negative consequences. I should imagine that, should this come to pass, we'd all be better off emptying our company coffers before this legislation comes in.

This may be a naïve question, but what's to stop Fiisch Contracting Ltd. setting up a HQ in the Isle of Man, ala larger corporations adept at tax avoidance?

Poor Matt88 sounds like he's had enough of being out-earned by the contractors he sits next to....

[vwdan]

Usual crap

Matt all of the advice you post seems to be absolutely awful and doesn't seem to be based on experience. What is your contracting experience? Do you actually run a Ltd Co...

(I know you don't, I just copied and pasted my last post to you because people need to be aware that everything you type is crap. I can only presume there's some weird jealousy here, but you don't seem to have a clue about anything Contract related but you post from a position of perceived knowledge which really gets my goat. Why even post here - is it because you wanted to be a contractor and didn't have the balls and skills?)

Oh, just to nip this in the bud:

£35k a year employees, earning £100k+ a year, was never really sustainable. I know it's fantastic for you, because there's no chance in hell you'd ever earn a really high salary as an actual employee, but why on earth are the people in the government just turn a blind eye to all this stuff.

You had a nice run, and I'm sure you think you're something special, but you're not. You're people who would be earning £30-40k if you were an employee. So why on earth should you earn double that (a lot of which is tax avoidance) just because you have to pay your own pension, and holiday pay

Mind if I tell you about the time I left a £75k+ job to come back to contracting, because I was bored. I could get a job like that tomorrow.