In the aftermath of the chancellor’s budget announcement, many people are keen to ascertain what impact the legislative changes will have on them. Contractors are one of the groups who are likely to see significant changes to the way they work once the proposed changes to the way personal service companies will operate take hold, so they are keen to establish exactly what the future looks like for them.
Budget predictions hotting up
As the date of the 2016 Budget approaches, the speculation as to what taxpayers can expect from George Osborne’s announcement is making headlines. The most significant, at least as far as contractors are concerned, seems likely to be the proposed changes to the way public sector contracting will be managed through Personal Service Companies.
Currently, the onus is on the staff themselves to prove that they are compliant to their clients, but many people are expecting a change to be introduced which will shift responsibility onto the client, according to an article in the Sunday Times. This comes despite the Treasury’s own statistics showing that they believe that 95 per cent of PSCs are operating legitimately, causing some degree of controversy amongst those who will be most affected.
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How will the 2016 Budget affect contractors
After all the speculation surrounding the 2016 Budget, the news is finally in and experts and commentators are in the process of analysing how the announcements will affect the people of the UK. Contractors will be mollified by the news that the chancellor has had a change of heart on the matter of pensions following fears that attempts to to simplify the pensions system could result in savers missing out. However, no new limits will be imposed despite hints from the Treasury’s Steve Webb that the Treasury would use pensions reform to generate a windfall for their coffers.
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Contractor concerns in the public sector
The impact of the 2016 Budget is still to be assessed as further details of the changes due to be implemented are released, but one aspect of the announcement has caused a little concern amongst those contractors who tend to work for the public sector. Contractors who work for pubicly funded clients through personal service companies will be subject to IR35 testing from April 2017, which has apparently put some contractors off pursuing public sector opportunities.
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Bank security could be in contractors’ hands
After a couple of well-publicised security breaches from large banks such as RBS and HSBC, customer confidence in their banks has taken a severe knock. Financial institutions which want to protect their data, reassure their customers and avoid security breakdowns are turning to expert contractors in order to ensure that they have the expertise they need available to them. The Chair of the Treasury Select Committee has also advised that banks draft IT savvy individuals onto their boards in order to better protect them from the possibility of cyber attacks and strengthening their security systems.
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