Third of freelancers plan to stop contracting in UK due to IR35 (Workplace Insight)
Nearly a third of freelancers are planning to stop contracting in the UK because of the changes to IR35 due to affect the private sector in April, research has claimed. One in seven freelancers (13 percent) plan to find contracts abroad, 11 percent plan to stop working or retire early and 8 percent plan to move into employment. Half of the freelancers surveyed also said they will only continue freelancing if they can find contracts to which the new off-payroll working rules do not apply.
An overwhelming 97 percent of respondents said they are either ‘fairly concerned’ (18 percent) or ‘very concerned’ (79 percent) about the changes to IR35. Also, 92 percent said they think that working inside IR35 and paying employee National Insurance contributions without employee rights is unfair.
The controversial IR35 measures were implemented in order to prevent tax avoidance by “disguised employees”, those contractors with permanent positions at companies without paying the same tax or national insurance as standard employees.
Under the latest IR35 reforms, private sector employers will now be responsible for assessing whether or not contractors need to pay income tax and national insurance contributions.
The reforms have left contractors fearing the worst, as there are worries that the private sector will take a risk-adverse approach and unfairly place contractors under the regulations.
Business groups such as the REC (Recruitment and Employment Confederation) are urging new Chancellor Rishi Sunak to suspend the rollout.
Pensions tax relief cuts risk making self-employed savings crisis worse (The Telegraph)
A Treasury raid on pension tax relief could deepen the savings crisis among Britain’s five million self-employed workers, industry leaders have warned.
The Chancellor is considering a 20pc charge on pension contributions made by those earning over £50,000 a year in next month’s Budget.
But it is feared that many self-employed people in particular are already failing to put away enough money for when they give up work – and there are concerns that slapping a tax charge on savings would be disastrous.
Tax relief changes could also spark a host of other unintended consequences. Fears were raised that axing higher rate tax relief for middle and high earners could also discourage employers from putting more than the minimum 3pc required contribution into workers’ pension pots.
Yvonne Braun of the Association of British Insurers said the industry supports moves to make the system simpler and fairer.
But she warned that reducing relief would put employers off making generous contributions at a time when auto-enrolment is boosting workers’ savings.
The proposals have been criticised as they could force more than half a million people to pay tax twice on their pension contributions – once before they pay money into their pension and a second time when they begin to draw an income in old age.
An effective increase in tax could make the UK less competitive in retaining high-skilled, mobile workers such as data scientists and software engineers, although the size of this effect was likely to be limited, he said.
Some workers could find themselves as much as £300,000 worse off as a result of the proposals after lost investment returns are factored in.
Record number of Brits in work — and on zero-hour contracts (Yahoo! News)
Employment in the UK has hit a record high and real wages have finally recovered from the financial crisis more than a decade ago, according to official figures.
But the latest employment data from the Office for National Statistics (ONS) also shows a record number and proportion of UK workers are in insecure jobs on zero-hour contracts.
Britain has seen a jobs boom in recent years, breaking several records despite Brexit uncertainty, sluggish growth and low levels of investment and productivity. More than 32.9 million people are now in work.
The employment rate reached a record 76.5% between October and December, up 0.6 percentage points in the past year. The unemployment rate remained steady at 3.8%, while the number of people defined as economically ‘inactive’ also hit a record low of 20.5%.
Meanwhile wages were up 3.2% a year earlier, taking average pre-tax pay to £512 a week. Average earnings excluding bonuses are now £1 higher in real terms, accounting for inflation, than in March 2008, when they peaked just before the financial crisis.
But the figures also show an estimated 974,000 people, some 3% of all people in work in Britain, earn their main income from a job with no guaranteed hours. The record high marks an increase of 130,000 workers in a year.
Frances O’Grady, general secretary of the Trades Union Congress (TUC) called for a ban on the contracts, warning they mean last-minute shift cancellations and uncertainty for workers about paying their bills.
Labour’s shadow work and pension secretary Margaret Greenwood said more people than ever were living “from week to week” because of the lack of guaranteed hours. She echoed the demand for a ban, and called for a £10-an-hour living wage.
‘If all freelancers walked out, the TV industry would stop’ (BBC News)
Adeel Amini, a freelance TV producer, discusses the importance of the availability of after care for freelancers working in TV.
The 34-year-old, who works on high-profile comedy and entertainment shows, was diagnosed with having borderline personality disorder.
He believes the condition, which can leave him feeling anxious, depressed and lonely, was “exacerbated” by a lack of care in the cut-throat and often uncertain world of TV.
“It’s definitely not a fun industry to be in if you have a lot of those issues,” he tells the BBC. “The fleeting, sporadic nature of the work, and the constant questioning of your self-esteem because the phone isn’t ringing.
“Even if you think you’re still on top of your game, a few months of that can completely knock you sideways.”
Financial Times: Deutsche Bank faces departures over contractor pay cut – Emma Agyemang and Stephen Morris (Financial Times)
Deutsche Bank is facing a rash of contractor departures in vital compliance areas such as anti-money laundering after angering its freelance workforce by demanding they take a 25 per cent pay cut in response to a change in UK tax law.
As many as 50 out of 53 workers in Deutsche’s London-based “change-management” team specialising in global financial crime are considering leaving by the end of March, according to two people close to the situation.
The contractors are upset by changes made to the bank’s hiring policy on freelancers ahead of reforms to the UK’s off-payroll tax rules, known as IR35.
‘I’m heading for a breakdown’ – how tax rule changes are pushing freelancers to the edge (The Telegraph
The IR35 tax reforms are being so detrimental to Freelancers welfare that it’s forcing some to contemplate suicide.
Although the aim is to uncover those who are working under “disguised employment” and are avoiding tax payments, the new rules are also affecting innocent freelancers who are losing out on contract work because businesses are too afraid of employing them and potentially getting into disputes with HMRC.
Read the devastating effects the new IR35 reforms are having on countless freelancers here.
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