budget Articles

marketing | 24 September 2015
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Earlier this week Chancellor George Osborne announced that the first purely Conservative Autumn Statement will take place on November 25th 2015.

The Autumn Statement has, in accountancy circles, grown to become a sort of ‘mini-Budget’. However, a lot of the announcements we’re expecting in this November’s statement are continuations and extensions of changes put forward as part of the Summer Budget.

With a little over two months to go until the next budget announcement we’ve put together a preview, analysing how some predicted changes could affect contractors in the UK. 

marketing | 27 July 2015
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Several weeks on, the contracting and freelancing sector has had time to digest George Osborne’s ‘emergency’ summer Budget. In case you missed it, the chancellor had several nasty surprises up his sleeve on 8th July as he delivered the first all-Conservative Budget since November 1996. In what was described by industry commentators as a four-pronged attack on limited company contractors, the MP for Tatton announced that: 

  • A new tax on dividends would be introduced, with a view to tackling “tax-motivated incorporation”

A review of today’s Summer Budget (8th July 2015) highlights the following key points that could affect Umbrella Company workers or contractors/freelancers who operate through their own limited company :

Personal tax

Employment intermediaries and tax relief for travel and subsistence – As announced at March Budget 2015, the government has published a consultation document alongside the Summer Budget on detailed proposals to restrict tax relief for travel and subsistence for workers engaged through an employment intermediary, such as an umbrella company or a personal service company. The changes will take effect from 6 April 2016. (Finance Bill 2016)

IR35 reform – The government will engage with stakeholders this year on how to improve the effectiveness of existing intermediaries legislation (‘IR35’) which is designed to protect against disguised employment. A discussion document will be published after Summer Budget 2015.

The Government has published the full budget 2015. A search for contractors, freelancers and umbrella companies highlights the following:

Umbrella companies and employment intermediaries

1.250 Autumn Statement 2014 announced that the government would review the growing use of overarching contracts of employment that allow some temporary workers and their employers to benefit from tax relief for home-to-work travel expenses, relief not generally available to other workers. This is unfair. As a result of the review, the government will change the rules to restrict travel and subsistence relief for workers engaged through an employment intermediary, such as an umbrella company or a personal service company, and under the supervision, direction and control of the end-user. This will take effect from April 2016 following a consultation on the detail of the changes. It will level the playing field between employment businesses that seek to lower their costs by using these arrangements and those that do not.

Today, 18th March 2015, is the final budget before the General Election. At Umbrella.co.uk we will be reporting all the changes that will affect contractors, freelancers and umbrella companies.

Because this is the last budget pre-election many hope that it will be an opportunity for good news as the Tories will be keen to gain support.

marketing | 3 August 2015
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Amid controversy over the Summer Budget four-pronged attack on the contracting sector, a separate and potentially troublesome government crackdown has gone relatively unnoticed.

marketing | 10 July 2015
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Following George Osborne’s Budget speech there’s been a lot of conjecture and analysis of what the changes will mean for the contracting industry. Now that the dust has settled and the numbers have been crunched, there’s no getting away from the truth of the matter – it’s not good news, despite the excitement of Ian Duncan Smith. However, it’s certainly not all doom and gloom and changes to how contractors are taxed won’t diminish the growing demand for their skills.

Budget 2015 confirmed that a review of contractors expenses and in particular travel & subsistence would take place in the summer of 2015 with potential changes being made for the tax year commencing 6th April 2016. It proposes that Supervision, Direction and Control (SDC) will be the key factors in deciding whether a contractor is genuinely a self-employed or should in fact be treated as an employee of the end client where they are working.

marketing | 18 March 2015
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The Chancellor started with his opinion of how “Britain is Walking Tall”. Economy growing faster than any other major country and number of people working at an all-time high with claims at a long term 40 year  low.

Pre-Election buzz words are that the Government have a plan and it’s working and that it needs to be stuck to. From austerity to prosperity. Out of the red and into the black. Britain on right track, we must not turn back.

There have been a number of scare mongering stories that the days of Umbrella Companies are numbered following the inclusion on 10th December 2014 of the following statement in the Finance Bill