I prefer a flat rate tax system; slim down the tax codes to a couple of pages of A4 (I will still contract); the country can then save loads of dosh by sacking HMRC public sector idiots; will not happen because HMRC/Gov like complexity and ambiguity in the belief that it increases revenue.
29 posts • joined 31 Jan 2013
HMRC reckons that only one in 10 contractors
"HMRC reckons that only one in 10 contractors in the private sector who should be paying tax under the current rules are doing so correctly. It estimates the reforms will recoup £1.2bn a year by 2023."
Based on court cases ref
1 in 10 sounds about right.
BAE Systems tosses its contractors a blanket... ban on off-payroll working under upcoming IR35 tax reforms
It's happening, tech contractors: UK.gov is pushing IR35 off-payroll rules to private sector in Finance Bill
"I think the govt recognsed the loop hole as to how contractors have been dodging taxes for decades and making millions, ..."
I believe the heavy use of the Limited Company model by contractors came about through more rubbish conservative legislation (the inability to see beyond the end of their nose and the resulting unintended consequence); at one time in the building trade firms were employing labours as self employed; the labours were paid without stoppages and subsequently paid no tax; legislation was introduced to throw liability for unpaid taxes back onto the firms employing the labours; this impacted all sectors with the result contracts would not be contracted unless they worked through some sort of company entity (i.e. avoiding liability for any resulting unpaid taxes); working through a company was forced and any resulting tax advantage is the fault of the conservative government of the time!
I wonder what will happen with the latest legislation?
Re: has this actually raised any more tax?
IPSE put the value of contractors to the economy at 130 billion, what do HMRC expect to raise 3-4 billion.
When it comes to do as I say not as I do; Phil Hammond's company paid short of 6K corp. tax on 1.6 million; I will bet there are a lot of contractors out there who paid more in corp. tax on a lot less.
Simple solution do not vote conservative, they are anti-business and are unfit to govern the UK.
HMRC loses ‘disguised employee’ contractor case.
Not really working in the public sector, I wonder if this latest IR35 tweak is going to trigger a litigation shit storm. Politicians and the unintended consequences of the legislation, or is it the fact that they simply do not care about the country?
Re: Not again!
"Now it plans to do the same for the private sector, saying that just 10 per cent of PSCs apply existing legislation correctly, with the cost of non-compliance estimated to reach £1.3bn by 2023-24."
I recall that at one point PCG/IPSE had won over 1500 IR35 cases, while HMRC had won literally only a handful, 10% really?
An IPSE commissioned report suggests that flexible work force contribute of the order of £125 billion to the economy, HMRC are aiming to recover £1.3 billion; even if the IPSE commissioned report is optimistic I would suggest there is a strong possibility that the IR35 private sector reforms will lose lots of revenue. There is no accounting for stupidity!
Re: Companies will take the easy & safe choices
To raise more revenue maybe the tax man should crack down on companies like Philip Hammond's which pays £5964 corporation tax on a £1.6 million profit. I will bet that many contractors pay more corporation tax than Hammond's company on a fraction of the profit, I know that I do.
The Conservative motto "Do as I say not as I do"
Philip Hammond's company paid just £5964 corporation tax on $1.6M profit; I have paid more corporation tax each year on a fraction of the turnover; what was that about avoiding paying the correct tax each year?
If you want to stay in the EU I have a better idea, how about making arguments based on verifiable real world fact and/or data as opposed to FUD and opinion; to give you a helping hand here is an example of a leave argument; at the time of the referendum the EU accounted for approximately 16-17% or world GDP and declining (in the 70s it was 30% plus), that means that 83-84% resides in the rest of the world; I back trade with the rest of the world unencumbered by EU protectionist crony corporatism; a small percentage of something big is probably going to be worth more than a large percentage of something small and getting smaller in long term.
You may also like to explore the lack of democracy (law originating from the commission), systemic corruption (accounts not signed off for 20+ years).