Are you really self employed – and does it matter?
Are you really self employed – and why it matters
In November 2016 the Government commissioned Matthew Taylor to lead a team and report on “employment practices in the modern economy”. Taylor himself has been a Labour politician and was a political strategist, being appointed by Tony Blair as head of the Number 10 Policy Unit, and is currently Chief executive of the Royal Society for Arts.
The Taylor report will be important to you as a contract worker because it is leading to changes in the way you are taxed and provide your services.
The report had a wide ranging brief, and as the populist press has picked up on looked at the so called gig economy as well as the “black” economy. It also focused on 3 main challenges:
Tackling exploitation and the potential for exploitation at work
- Increasing clarity in the law and helping people know and exercise their rights
- Over the longer term examining and re- aligning the incentives driving the way we work
The principal recommendations affecting tax are:
Employment law status ‘worker’ should be replaced by Dependent Contractor (DC). This would be a new status, not quite the same as worker is now, and in arriving at this new definition, ‘control’ should be of greater significance than any requirement to ‘perform work personally’
- More clarity is needed to help people understand their tax and employment status, both in terms of obligations and rights. An online tool for employment law might assist with this
- Tax and employment law status definitions should be brought closer together
- Self employed individuals should pay more National Insurance Contributions (NIC) in exchange for the enhanced benefits they now receive
- Cashless payments to all businesses would help close the tax gap.
- Making Tax Digital (MTD) will be a positive step and will help businesses pay the right amount of tax. It should be brought in as soon as possible
If you are not sure about your current status or how any of this will affect you then please contact us directly. As specialist accountants we are able to help you maximise your weekly income.
The full (lengthy) report is here Taylor report on modern working practices
For further advice existing clients email us at support@anytime.uk.com or call 03333 110 230
For new enquiries contact us now
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