Off Topic The Politics Thread
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Found this interesting article today regarding self-employed contractors SB, I have almost all of these overheads to deal with, an have had to wait a couple of months between my last two contracts, and now HMRC are adding an extra squeeze (thankfully the NI debacle was scrapped).
The ‘perks’ contractors have to pay for, but employees take for granted
March 15, 2017 | Filed Under: News
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With the tax differential between limited company owners and traditional workers substantially reduced due to successive dividend tax hikes, why don’t policy makers take into account the extra costs contractors have to bear compared to employees?Policy makers don’t understand how ‘contracting’ works
In recent years, Government tax policy has been increasingly focused on what it currently refers to as ‘tax-motivated incorporation’, based on the suspicion that large numbers of individuals incorporate purely to pay less tax on their earnings.
The tax hike in April 2016 was the perfect example of this – an indiscriminate tax increase, which affects all company owners, regardless of their motivations, or industries they work in. And, just to make sure, the Government has already meddled with the new dividend tax rules and announced a cut in the dividend allowance from £5,000 to £2,000 from April 2018.
This Budget 2017 announcement will cost a typical contractor between £250 and £1000 extra per year, on top of the existing 2016 dividend tax hike (which in itself will cost the average contractor several thousands per year).
What infuriates so many within the contracting industry, is the approach policy makers have towards those who work on their own account – and the “outrage” shown by some newspapers in recent years, who claim that limited company professionals are ‘tax dodgers’, or ‘pay just 20% tax on their earnings’.
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Those who frequently criticise the use of so-called ‘personal service companies’ forget:
a) Limited company owners pay 20% Corporation Tax on their turnover, but also personal tax on any dividends and salary they draw down.
b) Almost all professional contractors are obliged to work via intermediaries – it is hardly a ‘choice’.
c) A typical limited company contractor will earn more, and have a lower tax percentage than a PAYE employee. But at the same time, contractors have no ‘perks’ of the job, and less job security than employees.
Here are some of the things professional limited company workers have to pay for, which ’employees’ take for granted.
Typical costs a limited company professional has to bear
- Accountancy fees.
- Professional Indemnity Insurance.
- Other Insurances (e.g. Public / Employees’ Liability).
- Professional Memberships (e.g. IPSE).
- Training costs (e.g. Microsoft certifications).
- Software costs.
- Hardware costs (e.g. PC, printer, cabling, servers, etc.)
- Pension contributions (many employee contributions are subsidised, a significant perk).
- Stationery.
- Printing Costs.
- Postage Costs.
- Costs of accommodation when away from home.
- Travel costs whilst on business.
- Business phone costs.
- Business broadband costs.
- Company administration costs (e.g. Confirmation Statement).
- Advertising / Marketing costs (e.g. LinkedIn membership).
- Health / Dental Insurance Cover (e.g. BUPA, WPA).
- Allowance for sick days taken (contractors don’t get paid when they are ill).
- Allowance for holidays taken (contractors don’t get paid when they’re on holiday).
- Allowance for maternity / paternity leave.
- Client-site catering (many employees have discounted food – this is often restricted).
- Childcare vouchers (often subsidised for employees).
They missed out compassionate/ family leave - my wife having to take some months off while she supports her mother through chemotherapy. Good job I have a dull old PAYE job.
Cheers Col. If the mum in law looks after herself she should be fine, they caught it earlyish. Still stressful and unpleasant though.
more good news, £5billion investment from Qatar and a massive oil find just off the Lancashire coast. Trigger Article 50 Teresa girl, before the EU come sniffing to help bail out the Greek debt
Thought the oil find was off the LANCASTER coast, Shetland!
Correct Durbar.......So it'll be Scotlands oil then?
Hurricane makes 'largest undeveloped' oil find in UK waters
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- From the sectionNE Scotland, Orkney & Shetland
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Image copyrightHURRICANE ENERGYAn oil exploration firm has made what it has described as the "largest undeveloped discovery" of oil in UK waters.
Hurricane Energy said one billion barrels of recoverable oil could be contained within the Greater Lancaster Area, 60 miles (97km) west of Shetland.
The company hopes to begin production in 2019.
Dr Robert Trice, Hurricane's chief executive officer, described the find as "exciting times".
He said: "This is a highly significant moment for Hurricane.
"We believe that the Greater Lancaster Area is a single hydrocarbon accumulation, making it the largest undeveloped discovery on the UK Continental Shelf (UKCS)."
Giant field
The discovery is significantly larger than the average find in recent years, which has been about 25 million barrels.
However, it is still a fifth of the size of the Forties field, which contains about five billion barrels - of which approximately two billion have been recovered.
Hurricane discovered oil in two wells which sit about 30km apart.
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Image copyrightHURRICANE ENERGYImage captionRobert Trice of Hurricane said it was a "highly significant moment"
The company believes the oil they found forms part of the same giant field.
Drilling at the Halifax prospect found a column of oil-bearing rock of at least 1,156m. It has been described as "very significant" in an independent analysis.
'Signs of optimism'
Operations had to stop for budget and safety reasons, but Hurricane Energy plans to return for further appraisal.
Shares rose 6% in early trading after the Halifax announcement. In the past year, their value has risen five-fold.
Hurricane Energy has focussed its efforts on what it believes are neglected geological formations known as naturally fractured basement reservoirs.
These occur in a series of drilling blocks west of Shetland, which Hurricane has apparently named after RAF aircraft, also including Typhoon, Whirlwind and Warwick.
Lancaster and Halifax lie between the Schiehallion and Solan fields, west of Shetland, and to the south-east of Foinavon.
Hurricane Energy claims to have found more oil in UK waters than any other exploration company over the past 10 years. All its prospects are wholly owned by the one company.
'Extremely exciting'
Deirdre Michie, chief executive of industry body Oil and Gas UK, said: "This is extremely exciting and welcome news for the UK Continental Shelf.
"Hurricane Energy's announcement - coming just days after the Oil and Gas Authority awarded new licences to companies to explore for oil and gas in frontier areas - demonstrates the significant remaining potential of the UKCS.
"Signs of optimism, mainly led by exploration and production companies, are returning to the basin, which has worked hard to reduce its costs and improve efficiency.
"However, the UKCS needs fresh investment so it can capitalise on its potential, whether that be from new geological plays, or from enhanced recovery from existing fields.
"There are still up to 20bn barrels of oil and gas to go after in the UKCS and we believe that makes the basin a very positive investment prospect indeed."
Paul Wheelhouse, minister for business, innovation and energy said: "Today's announcements of the first oil from the Flyndre field and the undeveloped discovery within the up to one billion barrels of oil equivalent thought to be recoverable from the Greater Lancaster field make it clear that the continental shelf in waters adjacent to Scotland, such as areas to the west of Shetland, continue to hold very significant potential.
"In total, it is estimated that up to 20 billion barrels of oil equivalent remains under the North Sea and in the wider basin.
"I congratulate both companies on their announcements which further demonstrate Scotland's oil and gas industry has a bright future, for decades to come."
Hope all goes well pal - so yes, us contractors get well paid, but have to bite the bullet when hard times come a'calling - three times in the last ten years I've had to sit it out during dry spells of work in excess of 3 months, which puts a massive strain, both financially and mentally, but having learnt from my first one, I squirrel away as much as I can afford to help me through the lean periods
By the way, going back to the money we give in aid I see India is spending theirs trying to have their spacecraft land on the moon!!!
Just finished watching the post Brexit vote Question Time Special and left feeling frustrated that nobody asked the obvious question. This is not a trick. I do not know the answer and was hoping that there would be enough on here who have read up enough about it to know what the answer is. We have heard a lot about the possibility of no deal being better than bad deal and the one thing I have managed to glean from the debates for the last nine months since we all learned about Article 50 is that we have two years in which to resolve contractual and membership issues and if we don't that's it. We're gone.
But it's not that simple. What happens to the unresolved disputes? Most legal agreements and treaties have some form of binding terms for the resolution of disputes. Politicians on both sides have been remarkably reticent about telling us what it is in this case. If it is to be referred to some form of binding international court or arbitration forum what is it? I for one would like to know.
I can say confidently that when it comes to resolving the legal rights of the UK and the EU against each other it will not be decided by the will of the people but rather the letter of the agreements reached. Both sides will posture about the strength of their negotiating position but deep down they will have a good inkling about the legal validity of their posturing. At least I hope that the UK government does.
Apologies if this has already been aired and the correct position established. I must have missed it.
But it's not that simple. What happens to the unresolved disputes? Most legal agreements and treaties have some form of binding terms for the resolution of disputes. Politicians on both sides have been remarkably reticent about telling us what it is in this case. If it is to be referred to some form of binding international court or arbitration forum what is it? I for one would like to know.
I can say confidently that when it comes to resolving the legal rights of the UK and the EU against each other it will not be decided by the will of the people but rather the letter of the agreements reached. Both sides will posture about the strength of their negotiating position but deep down they will have a good inkling about the legal validity of their posturing. At least I hope that the UK government does.
Apologies if this has already been aired and the correct position established. I must have missed it.
Best wishes to your Ma-in-law and wife, Stan. Difficult times, I'm sure.
When Junckers started threatening the UK with a punishment beating, the UK reacted by saying it won't simply take what it's given and would prefer to walk away and rely on World Trade Organisation rules. A relationship on WTO rules is doable but not desirable for either the UK or the EU. If it comes to this, then the negotiators on both sides have failed. It's highly unlikely to happen imo.
It will be the European Court of Justice that claims jurisdiction should any EU member state refer a particular matter to it. Whether the UK accepts this jurisdiction after triggering Article 50 remains to be seen. This is a highly contentious legal area, and there are lots of legal opinions out there, and no consensus - a bit like whether the UK owes the EU money, and if so, the quantum.
These disputes between sovereign states are almost beyond a court. If the UK rejects the ECJ jurisdiction, what does the court or the EU do? Seek to negotiate a resolution outside the court, which is what is happening anyway.
When you post your ant-Tory drivel I don't even bother to read it. So the Guardian should be grateful I read 3 lines.
I hope you're right. However there are a couple of obvious problems in your analysis. Everything I have seen thus far clearly states that the a party that has triggered Article 50 remains a member of the EU until an agreement has been reached between the departing member and the rest of the EU or 2 years have elapsed without agreement. We remain therefore subject to the jurisdiction of the ECJ for that period of time at least and the other rules of membership the UK has signed up to. Just as with any limitation period I would fully expect the party that stands to lose its right to make a claim in legal proceedings to issue proceedings before the last date on which it can do so.That claim can then be stayed to allow the settlement negotiations to be concluded
The second difficulty I see is that while it may be satisfying to some to stick two fingers up to Brussels if a demand for payment is made, the Government has already stated it intends to honour its legal obligations. One would hardly expect it otherwise. This is not a tin pot third world corrupt dictatorship. I doubt whether the UK government will wish to drag the country's reputation through the mud by doing as you have suggested and default on its obligations. You are quite right though that there will be further negotiations to broker a deal if we do reach that impasse in 2 years' time.
I'm not impressed necessarily by the lots of legal opinions out there and no consensus. The UK government has got it spectacularly wrong already once and wasted several hundreds of thousands if not a few million on the flawed argument that triggering Article 50 was a matter for royal prerogative by the Executive. Hence my hope that they have actually worked it out this time correctly and know with some certainty what the consequences may be if they are bluffing and the bluff is called.