Welcome to the News & Blog

Here at ClearSky, we want to keep you up-to-date with all the latest hot topics that may affect you and your business. This could be anything from IR35 to new legislations.

Please feel free to browse the various categories, individual posts and make your comments known to the author.

Taxman rides self-employment gravy train

The UK’s self-employment boom has helped HMRC line its pockets with over £50 million in Income Tax payments so far this year.

Figures published by the Office for National Statistics (ONS) reveal that the Revenue raked in £15.4 billion from self-assessment tax returns in the first three months of 2015, an increase of more than 15% when compared to the same period last year.

Last month, the taxman received £447 million from self-employed professionals – almost 3.5% of its total Income Tax haul. This is a significant increase on the £235 million achieved in March 2014 – which represented just 1.9% of Income Tax receipts. … Continue reading

By Tim Moore Beecroft,

Posted under: News, Tax issues | Leave a comment:

Act now to avoid further self-assessment penalties

Contractors and self-employed professionals who have not yet completed their 2013-14 tax return are being urged to do so immediately to avoid the threat of further penalties.

Taxpayers who have already been hit with an “unfair” fine of £100 for missing the January 31st deadline face a further daily charge if they do not act before April 30th. This leaves them just seven days to get their house in order.

HMRC estimates that as many as 890,000 people failed to meet January’s deadline, allowing the Revenue to rake in £89 million in penalties. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

Taxman bows to pressure over debt collection practices

HMRC has dramatically scaled back its use of external debt collection agencies, following mounting criticism over its behaviour when pursuing outstanding tax bills.

The Revenue first enlisted the help of external agencies in 2009 in response to increasing pressure to maximise its tax yield. Its reliance on these companies reached a peak in 2013, when it spent £14.8 million.

This spend dropped to £6.8 million last year, something that is likely to please both experts and taxpayers alike. Commentators have long questioned the wisdom of HMRC’s reliance on such firms, fearing a breakdown in communication could lead to individuals being pursed on the basis of out-of-date information. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

Will the UK’s tax structure strangle economic recovery?

Britain’s oppressive tax system could put the kibosh on future economic growth, causing the country to slip further behind its global competitors.

Accountancy firm UHY Hacker Young reveals that the UK’s effective tax rate of a third of GDP (32.9%) runs a full 19% higher than the global average – well ahead of the US, Ireland and Japan. The company warned that Britain could face stiff competition from Eastern Europe and emerging cities like Dubai if it fails to address this “weighty” burden.

Despite the gloom, the UK still has the better of its European neighbours. The study found that around 40% of the EU’s GDP goes over to national governments through taxation. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

“Business as usual” following trivial benefits U-turn

Contractors have been warned that a proposed exemption from reporting trivial Benefits in Kind (BIK) has been shelved.

The plans, announced in the Autumn Statement, were designed to exclude expenses that cost less than £50. Such items include a bouquet of flowers or small items such as a box of chocolates.

The new rules were set to form part of Finance Bill 2015, but were dropped at the last minute due to “recognition of the accelerated Parliamentary process that the bill will be subject to.” … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

Taxman blasted as French take lead on avoidance

HMRC’s handling of the HSBC scandal has once again come under attack, following the conviction of a multi-millionaire fashion heiress.

This week, Arlette Ricci, heir to the Nina Ricci perfume and fashion brand, was jailed by a French court for hoarding millions of euros in an offshore HSBC account. She was sentenced to a year in prison and two years suspended, along with a fine of €1 million (£720,000).

Ms Ricci is the first of 50 French nationals facing trial over HSBC’s offshore accounts, which were leaked to authorities by whistleblower Hervé Falciani. … Continue reading

By Tim Moore Beecroft,

Posted under: News | Leave a comment:

Contractors buoyant as confidence soars

Contractors are celebrating a surge in confidence, with high expectations for both their business and the wider economy.

Research from the association of Independent Professionals and the Self-Employed (IPSE) revealed optimism levels have soared over the last three months, fuelled by an increase in pay packets and opportunities. Almost half (41%) of freelancers expected to see a jump in contract availability, compared to just 15% who anticipated a decline.

The study found that independent professionals now earn considerably more than those in “traditional” employment. Contractors are able to command an average quarterly rate of £30,000, roughly 20% more than most employees earn in year. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

Taxman accused of self-assessment cash grab

HMRC has been accused of demonising innocent taxpayers who make accidental errors on their self-assessment returns.

Data obtained under the Freedom of Information Act reveals the Revenue is more likely to conclude that where tax returns are incorrect, the individual has acted deliberately rather than by mistake. Critics claim HMRC has significantly “hardened” its attitude in an attempt to rake in more money.

Figures show that almost 15,000 penalties were attributed to deliberate actions during the 2013-14 tax year. This is compared to just over 5,000 in 2012-13. The proportion of fines issued for “deliberate behaviour” has risen from 9% to 16% in this period, suggesting a trend to place more blame on the taxpayer. … Continue reading

By Tim Moore Beecroft,

Posted under: News | Leave a comment:

Firms bank on contractors to ease financial talent crunch

Financial services companies are increasingly turning to contractors as a way to combat the skills shortage crisis, a new study has found.

Research from recruiter Robert Half reveals that the current “war for talent” has created huge demand for flexible skills sets. The study claimed this change in approach marks a “significant shift” in the way businesses are recruiting staff, especially for accountancy roles.

The research said the shift was “vital” as the vast majority (97%) of financial services executives are struggling to source skilled professionals. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment:

4 new (tax) year resolutions for contractors

The start of a new tax year offers contractors the perfect opportunity to get their financial affairs in order.

Independent professionals are able to take stock of their performance over the last 12 months and think about potential changes they could make to ensure the next year is even more successful. To help, we have compiled four important resolutions every contractor should try and keep. … Continue reading

By Tim Moore Beecroft,

Posted under: Uncategorized | Leave a comment: