As the dividend tax changes draw closer, those who are going to be affected are increasingly concerned that the proposals demonstrate a lack of understanding about what it’s like to run your own business on the part of the chancellor. Some believe that a thorough overhaul of the taxation system is the only way to resolve the issues that prevent employees and independent professionals from being able to operate on a level playing field, but whether that’s likely to happen or not is a matter for debate.
Chancellor’s dividend payments antagonise critics
The planned changes to the way dividends are taxed have attracted a significant amount of criticism from those who believe that this will further disadvantage those who work for themselves. This has been fuelled by the knowledge that George Osborne himself will be benefiting from a £1,200 dividend payment from his family business, a company which hasn’t paid a single penny in corporation tax over the last seven years. This has prompted accusations that the chancellor’s ability to understand the impact of his proposals is limited by his lack of experience when it comes to working for himself.
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Tax review overdue according to experts
PRISM are a not-for-profit trade association who represent payment intermediaries and service providers, and they have warned the government that their current approach to taxation will see them failing to meet their targets unless they completely overhaul the tax system. Having set themselves the goal of reducing the tax gap, simplifying the tax regime and levelling the playing field between employees and independent professionals, HM Revenue and Customs are unlikely to meet any of these if they fail to conduct a full review into contractor tax.
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New rules on contracting in Germany could affect UK workers
German labour laws may not be the hot topic of conversation for most people, but changes to the way contractors are treated in the German labour market have caused some concern this week. Chancellor Angela Merkel has announced plans to limit the length of time for which a contractor can work for the same client before being put on the payroll and treated as an employee. Ms Merkel’s proposal includes a cap on the licences that German companies use to hire workers from overseas, including the UK, and this has provoked a concerned response from trade bodies including APSCo, Hays and SThree who have joined forces to fight against the change.
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Digital revolution to provide government opportunities for contractors
The government’s plans to digitise their services have prompted the creation of a new select group of IT experts who have been put together to advise and support those who will be implementing the plans. With leading lights from such market leaders as Amazon, Goldman Sachs, Facebook, LoveFilm and Asos, amongst others, the newly formed Government Digital Services advisory board will be chaired by Stephen Foreshaw-Cain, formerly of Capgemini and Accenture.