Tag Archive | "contractors"

Only Digital Banking Please…We Are Self Employed


Do you ever get tired of cashing cheques and paying in money at your local bank? A digital banking company might just change that.

They are called Revolut, and so far have been a big success in the consumer banking market. Now they are eager to move into the business arena, with self employed people such as contractors, freelancers, gig workers and small business owners right at the top of their list.

So far, 12,000 businesses have signed up for the digital banking service offered by Revolut, and if reports are to be trusted this includes a few FTSE 100 companies.

You don’t have to be a big business doing millions of pounds a month to use Revolut though…it is open to any self employed person that wants to move their banking into the 21st century.

The service starts at only £25 a month, and then moves all the way up to £1000 a month depending on how much you are banking with them and what kind of customer benefits you receive. You get the first month for free to give it a try.

Once signed up, you get a business banking card that can be used in 25 different currencies and has no fees when used. Not a bad deal if you ask me, especially if you do a lot of business with clients and companies from abroad.

Traditional banks often take high fees for themselves if you receive money from abroad, and this usually comes with a terrible conversion rate. It appears that Revolut might just be the alternative option that self employed people in the UK have been looking for.

Not only that, but when you consider that most contractors and freelancers these days get paid online without any cash or cheques, then it’s easy to see why digital banking is now a viable solution.

The founder and CEO of Revolut, Nik Storonsky, had this to say…”I have great confidence that Revolut for Business will experience the same demand as our consumer service has.”

I’m sure it will Nik, and many experts agree with me, with some commenting that Revolut for business is a game changer.

Also, I’ve heard from some insider sources that Revolut are planning to use this as a springboard to get into mortgages and loans for the self employed.

This is definitely an area that is currently being under served, with many freelancers, contractors, gig workers, and small business owners out there who just can’t get the finance they need, despite making a decent amount of money every month.

Let’s wait to find out what happens with the mortgages and loans, and of course, with this new digital banking service. Something tells me it is going to be successful and we will hear a lot more about Revolut in the coming months.

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Deliveroo Fight Back With Pay Per Delivery for Drivers


The takeaway delivery company Deliveroo have been in the news a lot recently, mostly being accused of hiring employees under the guise of “contractors.”

One of the arguments being used against Deliveroo is that in some cities they do pay drivers or couriers by the hour, typically getting a set rate and then £1 per delivery, which means in many people’s opinion this makes them employees and not contractors.

Not content to just sit back and be attacked in the press, Deliveroo have decided to hit back at their critics, by bringing in a new pay structure for their self employed drivers.

What they have come up with is a pay per delivery structure as an option for all workers. Last year Deliveroo actually tried to make this mandatory for everybody, but it now seems to be voluntary.

Will many workers take up this new pay structure from Deliveroo? Probably not. While some drivers appear to be okay with being classed as a contractor and self employed, there are many that want full employee rights. Thousands protested last year, and there is expected to be protests this year.

I just think that if these drivers took the job on the understanding that it was a self employed position, then what are they complaining about? If they want traditional based employment where they are classed as an employee then go to another company. It really is as simple as that, but of course, many don’t want to listen.

Interestingly, after a bit of testing Deliveroo have said that the Pay Per Delivery structure, on average, earns their drivers £12 an hour, while those on the hourly based structure only get around £9.50 an hour.

£2.50 extra per hour and a lot of drivers are not interested…it really does make you wonder if some of these workers are actually interested in “working” or if they just want to get a cushy job with an hourly rate where they do the bare minimum.

Drivers who use Pay Per Delivery also have the ability to see orders as they come through the system, and have the option to reject any deliveries they don’t want to make. Sounds like a good deal if you ask me.

Also, let’s not forget that contractor drivers who work for Deliveroo also get flexibility in when they work and for how many hours. This means some weeks they might only do 20 hours, while others it could be 70 hours. They can work around their schedule and lifestyle rather than the other way round.

I’m sure we haven’t heard the last of Deliveroo in the news or the employee versus self employed debate.

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Contractors to Finally Get Paid on Time…Maybe


I reported right here on this blog about how contractors spend an average of 20 days a year chasing clients for late payments. Sometimes they never get paid.

This led the government to step in and announce they would setup a special branch that is focused 100% on making sure contractors, the self employed, and small business owners get paid on time.

To be honest I doubted if they would actually go through and take action, but it looks like they have.

From last week, all large companies and limited liability partnerships will now have to share details of their payment practices with the government, and if they don’t, then they can expect to get punished and even be put out of business.

Not only that, but contractors who are finding it difficult to get paid by clients can go directly to the government to get things sorted.

Why are the government stepping in now? Well, I think they have just realised how much of a problem late payment is…with one report suggesting that self employed workers in the UK are owed £26 Billion pounds in overdue payments as we speak.

That is definitely not small change, and if big companies keep getting away with not paying contractors the money they are owed then it could start to become a real problem for the economy.

If the government don’t take action then it might lead to an economic meltdown, not something we want as Britain leaves the European Union.

The main information that large companies are now required to share is their average payment time for invoices. If they are taking too long then a government official will be demanding to know why.

Right now, it is only companies who have a turnover over 36 million a year or a balance sheet of over 18 million that will have to report on details of their payment practises, but as time goes on I think that smaller companies might have to do the same as well.

This ensures that contractors get paid on time by all of their clients, and they can even check to see the payment record of a particular company before agreeing to work with them.

Will this completely stop late payments for contractors though? Unfortunately not, as there is always a few companies that try to game the system and get around the rules.

Also, it remains to be seen if the government actually enforce the rules and punish companies that don’t pay contractors on time. They might take action for a few months to grab some headlines, but then start to ignore it after a while.

Hopefully this won’t happen, and contractors can finally get paid the money they are owed. At the end of the day, £26 Billion pounds owed is just way too much, and something needs to be done about it.

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UK “The Worst” for Self Employed Pensions


A team of pension experts recently took to the streets of 15 countries around the world and their findings were not exactly surprising.

Out of the 15 countries across Europe, Asia, the Americas and Australia, it was the UK that was ranked “the worst” for how many self employed people had their pensions sorted out.

Regular readers of this blog will be only too aware about how I’ve reported that many contractors, freelancers, and small business owners are just not educated enough about self employed pensions. Unfortunately, they are going to find out the harsh truth when they get to retirement age.

Looking at the numbers, the team of pension experts were shocked to discover that only 52% of the 4.2 million self employed people in the UK did not have any kind of independent pension. So that is a lot of people that have decided to rely solely on the government State pension, which in my opinion, might not even be around in 20 years time.

Compare this to an average of 36% that did not have a pension across the other 14 countries, and it becomes clear that in the UK we really need to push the message across to every self employed worker out there…

“You need to get your pension sorted…ASAP!”

I’m sure this is what they have been doing in India where only 12% of those surveyed mentioned they had no plan for a retirement pension. So that is 88% who have really got their act together it seems. Well done India. UK take note.

Actually, one of the main reasons why India are so clued up when it comes to the subject of independent pensions for the self employed is because they have no welfare system like here in the UK.

The same can be said for Brazil, China and Turkey as well, where the majority of those surveyed said they were actively saving into a pension.

However, the same can’t be said about countries similar to the UK that also have a welfare system, because France, Spain and Australia only did a bit better than over here, with many clueless about what to do for their retirement.

One thing I do know is that the team of pension experts must have been baffled when roaming the streets of the UK and talking to the self employed people of our nation.

I can imagine the look of bemusement on their face as…

Only 10% of those who have a retirement plan had it written down.

56% said I don’t have any kind of plan.

52% expected to be working past the age of 65.

49% said they plan to rely on the State pension from the government.

My advice on this, if you are self employed and don’t have any kind of plan for retirement and your pension…get it sorted as soon as possible. It really is the only way, because you don’t want to be still working when you are 75, or even 80.

The government are thinking about bringing in some kind of auto enrolment scheme for the self employment, similar to what they have in many companies for employees. Although it might be a while until we see that happen.

For now, you really need to take control of your own situation.

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Hammond Does U-Turn on Tax Grab


Just like I reported about last week, the Chancellor Philip Hammond went after the self employed in his budget with a tax grab, and many were outraged!

So much so that it now looks like Mr Hammond has decided to do an amazing U-Turn on his initial plans, in a move that we have never seen before from a UK Chancellor.

In a brief letter that was sent to all Tory MPs (I reported how many back benchers were not impressed by the tax grab plans), the Chancellor said that he would no longer be making Class 4 National Insurance payments more expensive for the self employed.

The right thing has been done of course, but it does raise some questions that need answering.

Firstly, how on Earth did they think doing a tax grab was a good idea in the first place? Just like I said last week, it was another slap in the face for our nations self employed. It’s almost as if many people in the government don’t have a clue.

Secondly, does the Chancellor have no conviction at all in what he is doing? To do a U-Turn so soon after the Budget really has made a lot of people wonder if this guy is even up to the job. The UK could soon become a laughing stock…it probably already is.

I didn’t agree with his decision to do the tax grab (and that does make me question his qualifications for the job), but what really makes me wonder about the Chancellor is the fact he was so quick to give in.

Sure, it’s good that you are willing to listen to other people and take on board feedback, but sometimes you have to stand behind your decisions. I think this was one of those times for Philip Hammond.

Other world leaders will no doubt be looking at this and noting down that the UK are potential easy targets when it comes to the negotiation table.

I’m not saying that Philip Hammond should not have backed down and gone away from his initial plans…but I think he did it way too quickly, and like mentioned before, with no real conviction is what he was doing.

Anyway, it’s good to see that self employed people are not going to be subjected to this tax grab, but in my opinion it really doesn’t change anything.

Contractors, freelancers, gig workers, small business owners…they need to be rewarded for what they do for the economy, especially when you consider that Brexit is just around the corner where the UK will be leaving the European Union.

These are the men and women that the government want on their side, but what are they doing to achieve this? Not a lot if you ask me.

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Tories Say No to Tax Grab on Self Employed


It’s that time of the year again…The Budget with Chancellor Philip Hammond, but some experts are predicting there could be a tax grab on the self employed.

This has led many Tory backbenchers to say enough is enough, and to remind Mr Hammond that constantly going after the hard working contractors and small business owners of this country just isn’t on at all.

One report suggests this years Budget could see National Insurance Payments targeted, with the self employed having to pay 3p in the pound more.

In my opinion this is just a blatant tax grab by Philip Hammond, and is in line with the usual “go after the self employed” tactic when they need to raise some extra money.

How about doing something good for those people who are keeping your economy propped up Mr Hammond? No of course, it’s always tax, tax, and more tax.

Right now 20% of the UK workforce are considered to be self employed, and with Brexit on the horizon these people are going to be more important than ever before.

The last thing the Chancellor wants to be doing is getting them angry…wouldn’t you agree? It’s the same old story though, and I’m sure the 3p change will be announced tomorrow.

It was only a few weeks ago that the Prime Minister, Theresa May, announced in a speech that small businesses, and the self employed in general, are more important than ever before.

Well, it doesn’t seem that Philip Hammond listened to that speech, he was probably too busy working out ways to get every last penny out contractors, freelancers, gig workers…you name it, they are all on his list.

To give you an idea of what this would all mean for the self employed, if you currently make 40,000 pounds a year, then expect an extra 80 pounds on top of what you already pay in tax and National Insurance.

Surely, the government should be looking at ways to encourage people to start out in business and begin working for themselves, and not trying to grab every last penny they can? I don’t think this has even occurred to them.

So now we are in a position where everybody will have to wait until tomorrow to find out exactly what the budget holds for self employed people. Who knows, maybe the Chancellor won’t move forward with this tax grab? Something tells me he will though.

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Public Sector Contractors Walk Out – “had enough” They Say


As you might be aware, changes are about to happen in the public sector with thousands of contractors facing disruption to their tax situation.

It is the IR35 tax change that has got everybody up in arms, and the reason is because many contractors who work in the public sector will end up paying more tax, something which many of them don’t want to do, obviously.

This has lead thousands of contractors to simply down tools and walk out. “I’ve just had enough,” said one contractor who wanted to remain nameless. No doubt they are leaving the public sector and going to offer their services elsewhere in a bid to avoid IR35.

What were the government expecting though, did they really think people would take it? Reports suggest they came up with the idea of changing the IR35 system in a bid to make £440 million a year from 20,000 hard working contractors in the public sector.

What they didn’t expect was that many of these contractors are going to walk out and never go back. Looks like it’s back to the drawing board for the people at government HQ.

One of the biggest areas of the public sector that hires contractors is IT with an estimated 18,000 on the books of Central government.

However, many reports are saying that IT contractors are the most affected by IR35, and they are not impressed at all. One example is a recent defence related IT project that is no doubt crucial for the nation…but 87 of the contractors working on that project have already left, with many more expected to follow.

It’s also come to my attention that another project involving public sector contractors, this time consisting of security consultants…well, almost half of the people in that team have already moved on to the private sector.

Let’s be honest here for a moment. Is it really a surprise this is happening? Of course it isn’t, mainly because people don’t like to lose money. Simple really isn’t it, but for some reason the organisers behind the IR35 change just couldn’t see this. Or maybe they did and just don’t care? Who knows exactly what is going on here.

What I do know is that at the end of March thousands more contractors officially come to the end of their public sector contracts, and guess what…many are not going to be renewing.

Instead, they will go boldly into the private sector, where they are not going to be subjected to this IR35 madness.

The only way they will go back is if the government decides to not go forward with the IR35 tax change, but I don’t think that is going to happen.

In the meantime thousands more public sector contractors are going to be walking out and going elsewhere.

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UK Population “Optimistic” About Entrepreneurship


In a recent study it was revealed that people in the UK were more optimistic about working for themselves, compared to other European countries.

These findings are no doubt going to surprise many experts, who have long been claiming that factors such as Brexit will mean less British people decide to do things like start a business, become a contractor, and get started in the gig economy. Well, according to this study the opposite is true.

Out of those asked, 44% of people in the UK said it was the best country to go down the self employed route, with 57% saying they were optimistic about the economy.

This doesn’t surprise me at all to be honest, because despite all of the negativity we keep hearing about in the news, the reality of the situation is that many Britons are hard working, ambitious, and want to work for themselves…and many won’t let anything stop them.

Sure, Brexit might cause a few problems with the economy, and yes, nothing is ever perfect…but when you are determined to succeed then nothing can stop you, and it seems that many people in the UK have this mindset.

Something tells me we are going to be alright, this nation of ours, as long as entrepreneur’s, small business owners, contractors, freelancers…they all keep pushing forward and don’t let anything or anybody stop them.

What appears to be even more encouraging is that younger people are more interested in becoming their own boss, with 76% of 18 to 24 year olds saying this is their goal. Compare this to 48% of 50 to 64 year olds, and it’s easy to see why UK economy is only going to become stronger, no matter what happens in Europe.

That isn’t to say that everyone is in support of Brexit though, as the study found that many people do have some concerns about becoming isolated from our European neighbours.

For example, 30% wondered about what our access to the single market will be like once Brexit has taken place, which of course, is very important for anyone that wants to do business with a company in Europe.

Of course, we don’t even know for sure exactly how much Britain is going to leave the European Union, so it’s difficult to predict exactly what is going to happen.

Back to the study and it was found that the 2 main reasons for wanting to become self employed were financial success (48%) and freedom and independence (47%).

You know, I hear this a lot from all you contractors, freelancers and gig workers out there…you just want to make a decent amount of money, but most importantly, you want to be your own boss and set your own schedule.

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Contractors Spend 20 Days a Year Chasing Late Payments


According to IPSE, the Association of Independent Professionals and Self Employed, if you work for yourself then you spend 20 days a year trying to get paid.

It’s bizarre if you ask me…when you consider how easy it is now for companies to pay contractors for their services with options like Paypal and bank transfer, I just can’t work out why so many self employed people are having problems getting the money they deserve.

Apparently, it’s mostly big companies that are not paying out, which doesn’t surprise me one bit, because if there is one thing we all know it is that some of these multi national companies can be a real hassle to deal with.

Everyone you speak to just wants to send you to another department, constantly trying to pass the blame. Maybe you can relate to that one if you’ve ever done some contracting work for a big company before? You couldn’t make it up how difficult they are to deal with at times.

The research by IPSE also went to point out that this 20 days a year we all spend chasing up payments equals about £16.5 billion in lost income. This is just plain madness and something really needs to be done about it…pronto.

Well, we might be seeing action taken soon enough, because it appears that people in high places have been taking notice of how big companies are treating the self employed, and if things go to plan then late payment could soon be a thing of the past.

Just imagine how much more cash you could make if you didn’t have to spend 20 days of your year chasing up companies that make billions, but can’t to seem to pay you what they owe? If the small business minister, Margot James is to be believed, then by April of this year all big companies and Limited Partnerships will have to check in twice a year with information about their payment practices.

In other words, if they don’t pay you, then the government are going to be asking why. One of the numbers that is going to be looked more closely at is the average amount of time it takes to pay invoices, and if it is too long then they can expect a fine.

I’m sure this is going to mean that contractors finally start to get paid quicker for their work, it is just a shame that it had to come to this…don’t you agree? What a sad state of affairs when the government needs to step in and say “pay people for the work they have done.” It’s almost as if these big companies expect people to work for free. Some times I think they do.

Nearly 5 million people are currently self employed in the UK, and with virtually nothing being done right now to ensure they get paid, this new move by the government is much needed.

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Barclays Now Offer Near Instant Business Lending


If you’re a contractor or small business owner, then you will no doubt be pleased to hear that Barclays now offer lending without the usual hassle.

One of the complaints I’m always hearing is how difficult it is for self employed people, especially contractors, to get a loan quickly and easily. Usually it involves a lot of forms to fill out and then a lot of waiting around until…declined!

While Barclays are not offering any guarantees that you will get approved for a business loan, it’s good to hear that they have made the decision process pretty much instant, which means you get to know if you are approved or declined almost straight away.

So how do you apply? The best way is through their mobile app, where you are asked a few basic questions and then how much you want to borrow.

They currently offer up to £25,000 and will let you know a decision within 60 minutes. Barclays are the first bank to offer this kind of almost instant lending, although if reports are to be trusted just about all of the high street banks are set to follow.

While it’s beneficial for contractors to get decisions on their business loan application as quickly as possible, I would like to see the lending remain responsible and not get to the point where anyone gets approved.

We had this kind of situation a few years ago of course, and it’s one of the reasons why the UK found itself in a less than desirable financial situation. Let’s hope some lessons have been learned.

If you are already a business bank account holder with Barclays then you’ve probably already received messages from them about this with a note telling you how much you could potentially borrow. While it can be tempting to take out a business loan when offered one, it’s a good idea to give it a lot of thought before moving forward, and in my opinion, only apply for a loan when you really need one.

At the end of the day, being a contractor can be difficult enough without having to struggle with loan repayments every month.

What I find interesting is that many thought business lending in the UK would slow down after the Brexit vote, but the fact that Barclays have introduced this new feature to their App and many other banks are doing the same, it would suggest to me the opposite is true.

A spokesperson for Barclays recently commented, “Since the EU referendum our appetite for lending has not diminished and we continue to lend to a business in the UK every 4 minutes.”

Like I said, let’s just hope that lending is responsible, but if it means a contractor can get the funds they need then I’m all for it.

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50% of UK Contractors are too Busy to Exercise


While being self employed no doubt gives you more freedom, it seems that half of UK contractors can’t find the time to hit their local gym.

This survey was conducted with the aim of discovering just exactly how self employed people are spending their time, and although it’s encouraging that at least 50% are doing some form of exercise on a regular basis, it’s no doubt a cause for concern that so many people are still not getting active.

The exact figure was 46% that didn’t exercise according to the survey, with 48% of women claiming they struggled to find the time, while 43% of men said the same.

In my opinion I think that just about everybody out there would benefit from doing some form of regular exercise, even if it’s just an hour or two on the exercise bike every week.

I think there is a big misconception that you need to spend a lot of money on joining a fancy gym and then start working out for 2 hours every day.

Sure, there are some people who enjoy doing that, and if you really get into the fitness lifestyle then it can be enjoyable, but for the vast majority of the population even a small amount of effort will do them good.

This comes at a time when we are facing more obesity in the UK than ever before, and one of the main reasons for this is simply because people are not getting enough activity.

Many contractors, and self employed people in general, often spend most of their day sitting at a desk, and then at the end of a working day go to sit on the couch and watch some TV.

I’m not going to say it’s easy to start exercising on a regular basis, because once you get into a routine then you typically want to keep on following it, even when logically you realise something needs to change.

What you must understand is that small changes should be the main focus at first. For example, just go for 1 exercise session a week, and then determine you are going to stick with it. After a while you can then move up to more sessions, but for now the main priority is to start making a change.

This all assumes that you actually want to make a change of course. For some people, maybe they just don’t want to exercise on a regular basis, at the of the day it’s all about what you want to do.

However, if you are part of the 50% of contractors that don’t currently exercise but you either want to or need to, then my advise is just get started, even if it’s just a minimal amount of effort at first. The most important thing is you take action and be consistent.

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Medium Sized Businesses Need More Contractors


Experts are advising medium sized business owners around the country to focus on hiring more contractors as part of a flexible employment strategy.

I agree completely with this one, especially when you consider the amount of talent that is available with the thousands of contractors offering their services right now, in a variety of different industries.

The message is simple: why go through all the hassle of hiring permanent staff, when you can easily hire a contractor who often has the same or more skills, but doesn’t have to be added to the payroll when the demand for their services isn’t required anymore by your business.

However, as studies have shown, many medium businesses who hire contractors for short term work end up keeping them around for months, and even years.

What I’ve been hearing is that many medium size business owners are really impressed with just how quick contractors are able to adapt to the job they are given, which in the past was a concern when hiring contractors.

The general thought process used to be…we are going to spend hours training someone who might not even be around in a few weeks. However, these days it’s much more a case of…just give them the work and leave them to it.

I think this highlights the importance of hiring specialised contractors so the amount of training is minimal, even if it means paying a bit more for their services.

For example, if you want an IT contractor for a specific project, then getting someone who is experienced in this area is essential. Anything else just ends up wasting your valuable time.

What are some other reasons why contractors are perfect for medium sized businesses? Well, for one, they are available to start right away when you get unexpected work or projects that needs to be completed quickly, and then once finished, there is no obligation to keep them around.

This also holds true for seasonal times such as Christmas where you might require extra staff for a couple of weeks to cope with more business and customers. Once the seasonal demand is over, the contractor no longer has to be kept on the payroll.

Another reason is that very often a contracting professional will bring fresh ideas into your business, which can give you more ways to profit. Just one idea can provide your business with an exciting breakthrough.

Ultimately, hiring contractors is all about building up a list of contacts that you can trust. Hire someone for a few weeks to finish a job and then drop them off your payroll, but they are always only a phone call or email away where you can contact them for another job.

At the end of the day it’s all about flexibility and what is the best overall strategy for your business.

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Contractors will Lose Jobs to Robots Say Experts


There was a time when the thought of robots doing ordinary jobs seemed far fetched, but the reality could be closer than you think.

This is according to Bank of England governor Mark Carney, who has recently gone on record to state that he believes 15 million jobs will be lost in the future, which of course, includes some of the jobs currently filled by umbrella contractors.

Is this really a true statement though, or is it simply designed to get headlines and attention? In my opinion a bit of both, because while we are definitely going to be seeing robots and computers doing more and more jobs (we are already seeing it), I think that 15 million jobs might be a bit exaggerated

Ultimately though, who really knows? I can only give my opinion, and I could very well end up being proved wrong by the Bank of England governor and his recent predictions.

So what are some of the jobs most at risk? Apparently telemarketers are right at the top of the list, with professions such as mathematical technicians, watch repairers, cargo agents and accounts clerks following closely behind.

There are many other professions included on the list, such as drivers, machine operators, credit analysts, cashiers, IT workers, office workers, and secretaries, to name but a few.

I’m sure that contractors in these professions are not particularly concerned by what experts are saying, and I don’t think they are going to suddenly find themselves unable to get work, but it certainly is something worth thinking about.

Interestingly, the report went on to say that people working in creative industries such as photography and fashion design were the least likely to be affected by robots. Good news for contractors who work in these kind of fields then.

This all comes at a time when retail giant Amazon have opened a new grocery store in America that does not have any cashiers at all. Here in the UK supermarkets do have some self service checkouts of course, but on the whole we are still being served by actual humans.

In this new Amazon store, they are using sensors to detect what is being picked off the shelves by customers, who are then charged accordingly direct to their Amazon account. In other words, they don’t even have to stand in line and wait to be checked out.

If you are to take anything away from this story it’s…the robots are coming for your jobs contractors, eventually.

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Some Contractors Looking Forward to Digital Tax


If you are an umbrella contracting professional then you are no doubt aware that income tax is about to change…by going digital.

More specifically, we are now going to see a new system implemented where you will file your tax returns online quarterly.

Since this was announced most people in the contractor community have been against the idea, but there are some contractors that seem to be looking forward to the new digital way of doing things.

The main problem with the system is that doing a tax return 4 times a year is simply too much, and for many self employed people it will take them away from their business for many valuable hours that could be better spent elsewhere.

I’m always willing to listen to other opinions though, and while it appears that many out there who are against it, there are some that are actually looking forward to digital tax.

Why you might be wondering? One of the main reasons that I’ve been hearing is that by doing a tax return 4 times a year it’s much easier to keep track of all your legitimate expenses and then claim for them.

For example, a recent survey showed that over 50% of contracting professionals don’t typically put down low value costs on their tax return.

However, now that they have to do it 4 times a year, this might just be the excuse they need to start recording everything, which ultimately means they will end up paying less tax.

Another reason why the new digital tax system might be good for your business? Let’s face it, there are many people out there who rush around at the same time every year trying to get their tax returns in by the deadline.

It’s similar to how people leave their Christmas shopping right to the last minute, and then go out on Christmas Eve at 5pm in a mad dash to find whatever they can.

Imagine if we had Christmas 4 times a year though…don’t you think that would make people more organised when it comes to shopping for presents? I think it would, and the same argument can be made about doing tax returns. The more you do it, the better and more efficient you become.

Still not convinced? Same here, but if you need another excuse to like the new digital tax era then how about this…it gives you a reason to finally get rid of that useless accountant that gets everything wrong each year, and instead, start searching for an accountant that specialises in doing tax returns for umbrella contractors.

Make sure you choose a good one, because you are going to need them 4 times a year now rather than just the once.

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May Appoints Blair Employment Law Advisor


In a move that is sure to be interesting for contractors around the UK, Theresa May has appointed Tony Blair’s old employment law advisor.

This comes just as the subject of employment rights has been in the headlines a lot over the past few months, with stories regarding zero hours contracts and employees who are hired as contractors even though many think they should be hired full-time.

One example of course is that of the company Deliveroo, who have been criticised by many in the media for having its workers on a self-employed basis rather than as employees.

In my opinion, this is something that goes in favour of the worker, mainly because they can earn make more money as a self employed contractor rather than being on a set wage.

It’s certainly a debatable subject, and not one that is straight forward by any means, but it is good to see that the Prime Minister is taking it seriously and potentially getting in the right people to look at the matter more closely.

The Blair advisor hired by Theresa May is Matthew Taylor, who worked in the Government between 2003 and 2006 and will now be tasked with setting up a new framework of employment rights for the millions of UK people around the country.

This is definitely not an easy task by any means, especially when you consider all of the different ways companies hire people in 2016, with contractors, freelancers, self-employed businesses and so called “gigs” where people offer their skills on a per job basis.

It’s also difficult when you consider that two people can do the same job but expect different things out of the position.

For example, one person might want company benefits and a pension scheme, while another will want the ability to work from home and have the freedom to work hours they choose. For this reason it can be almost impossible to decide what is the correct employment status for a particular role if workers view it differently.

What I will say is there are certain areas of employment where people are being taken advantage of. So called zero hours contracts that are now the norm in many warehouse and factory environments, are in some cases designed to benefit the employer greatly over the employee, to the point where the employee has virtually no rights at all.

I hope that Matthew Taylor is able to do something about this practice, and balance things out a bit more in some industries so that workers are given the basic rights they deserve.

As mentioned earlier though, it’s not always straight forward to decide what is right and what is wrong, and this is why I don’t expect to see big changes overnight.

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Only 1 in 5 Contractors Saving for Pension


A new report published by ONS, suggests that just 1 in 5 contractors are putting any money away for their pensions.

This worrying statistic is in stark contrast to the pension reform which has swept through much of the workforce in the last 4 years, with many employed people now being automatically enrolled into pension schemes from their employers, which ultimately ensures they will have more money in the bank when it comes time to retire.

However, contractors don’t have this luxury, and it is up to them to put money away for retirement but it seems that only 20% are doing this.

Why? In my opinion it has a lot to do with not planning enough for the future, as many contractors in the UK will be in their 20’s and 30’s, which means they might not yet be thinking about retirement and saving for their pension.

Another reason is they simply don’t have the money to put away every month, especially during times when work might be slow and they are only just getting by.

At the end of the day, in this post Brexit economy not every contractor and self employed person is finding it easy, and although things will no doubt change as the economy gets better, for now many contractors are having to do their best and take whatever work comes their way.

The report by ONS goes on to suggest that better education about pensions for contractors could improve the situation.

I agree completely, because there are a lot of self employed people in general that just don’t have all the facts, and would benefit greatly from more help in regards to setting up pension schemes and getting accurate information about the best way forward.

Not only that, but putting money into a pension scheme also has other benefits, such as tax relief and investment returns, meaning that most contractors would get a lot out of putting a bit of money away every month.

It’s interesting to note that figures show an average 22 year old contractor with earnings of £25,000 a year, could have a pension of nearly £200,000 by the time they reach retirement if they invested money into a scheme similar to the auto enrolment seen in the workforce.

As they say, a little bit each month soon adds up, and I am sure that most contractors would enjoy an extra £200,000 by the time they retire, on top of the usual state pension of course.

It is definitely something worth thinking about for the millions of contractors out there, because if only 1 in 5 are currently doing something about retirement, then there is many more that need to get educated and take action.

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