Hopefully, not so many shocks as they endured last year!
As you may all know, 2016 brought a lot of changes to the world of contractors. First, the apprenticeship levy will hit recruitment agencies because of the IR35 regulation changes that, in turn, give contractors an ‘employee’ status from a taxation perspective.
Secondly, the government gave into the pressure to many respondents who believed that limited company contractors in the public sector shouldn’t avail the benefits of 5% tax-free allowance.
Thirdly, the government will introduce a new 16.5% rate on the Flat Rate VAT Scheme from 1 April, 2017 for businesses with limited costs and by nature of work, this also includes a vast majority of contractors, and basically removes the benefit of FRS for contractors as there won’t be much to save.
The New Year is going to be interesting because the off-payroll rules will be introduced to public sector contractors from April 2017. Despite all the bad news, there are plenty of positives awaiting this labour workforce. Read on:
Activities related to Brexit to start in 2 months
PM Theresa May is confident that she will trigger Article 50 to set in motion the 2-year leaving process. This is reported to take place by March 2017. A “soft” Brexit is what contractors are hoping for because despite all the chaos caused by Brexit, there are still chronic skill shortages across industries. Hence, the demand for talent (and contractors) is likely to remain afloat for years to come.
Unemployment rate is down but there’s still hope
So far the unemployment level in the country is at an all-time low in 11 years, but it is not surprising at all! If reports are to be believed, the situation is going to stay so in 2017 as well. However, organizations hiring top talent with specialist contractors high up the list. This means there is still hope for them despite all the economic and political upheaval the flexible labour force witnessed last year.
Hope 2017 is kinder to contractors, freelancers, temp and everyone else who are currently not employed in any full-time job.